France PMI Manufacturing rose from 55.5 to 57.6 in February, above expectation of 55.5, highest in 7 months. PMI Services rose from 53.1 to 57.9, above expectation of 53.5, highest in 49 months. PMI Composite rose from 52.7 to 57.4, highest in 8 months.
Joe Hayes, Senior Economist at IHS Markit said:
“The slump in January proved to be short-lived as business activity growth accelerated sharply in February to its strongest since last June. Now that the trajectory of COVID-19 in France is on the downturn, this should continue to facilitate greater activity levels across both sectors. Indeed, anecdotal evidence from our survey panel suggests that business confidence is improving and supporting demand conditions.
“However, the economic themes for 2022 will be focused on supply chains and inflation, which seem a long way off normalising based on the latest PMI survey. Supplier delivery times lengthened sharply once again during February, while input cost inflation remains stubbornly elevated. Sources of inflation are broad – our panel members reported rising prices for a multitude of inputs, and these are now being compounded by rising utility costs and wages.
“We’re still yet to see these issues dent output, demand and employment, but it will take prudent macroeconomic management from policymakers to alleviate supply-side pressures without harming the demand-side of the economy.”
