Private sector activity in France was weaker than initially estimated in April, as the acceleration in growth in services was dwarfed by the biggest drop in nearly 3 years in the manufacturing sector, the report from the S&P agency. The composite PMI index that summarizes the performance of private sector activity stood at 52.4 in April, compared to an initial estimate of 53.8 on April 21. A value above 50 means expansion of activity, and a value below this limit means contraction.
Down since March (54.7), more marked than initially estimated, the index reveals “a slight slowdown in global expansion,” says the S&P agency, due in particular to the “strongest drop in production for almost three years” in the manufacturing sector. already reported on Wednesday by the same source. The global volume of new orders, however, accelerated its rise, “having allowed the reinforced growth of sales in the services sector to offset an acceleration in the decline in new orders in the manufacturing sector,” the agency specifies.
Services, “engine of French growth”
The services sector stands out “as the engine of French economic growth, with the manufacturing sector posting a sharp drop in output over the month,” Norman Liebke, an economist at Hamburg Commercial Bank, partnered with S&P for output, said in a news release. of this barometer of activity. In the service sector, growth “must continue,” he anticipates. Activity in the service sector registered its highest growth in eleven months, with a PMI Services index of 54.6 in April compared to 53.9 in March, thanks to “improving demand, particularly in export markets ‘.
Industry companies surveyed “frequently” reported “less customer reluctance to incur costs, both in domestic and foreign markets.” But if the pressures on the prices paid “decreased in April” they remain high. Many companies have also “reported an increase in the cost of wages.” Employment also “continued to grow across the private sector,” according to the agency. But the level of business confidence fell slightly compared to March, with “a drop in optimism among service providers.” The survey also highlighted “declining inflationary pressures” in the private sector, with costs “recording their smallest rise” in 20 months.
Source: BFM TV
