France PMI manufacturing dropped to 49.7 in December, down from 50.8, and missed expectation of 50.7. It’s the worst reading in 27 months. France PMI services dropped to 59.6, down from 55.1 and missed expectation of 54.8. It’s the lowest level in 34 months. PMI composite dropped to 49.3, down from 54.2. It’s a 30-month low and the first contraction reading in 2 1/2 years.
Commenting on the Flash PMI data, Eliot Kerr, Economist at IHS Markit said:
“Having held up reasonably well throughout the initial months of Q4, latest flash data pointed to an outright contraction in France’s private sector for the first time in two-and-a-half years, following the protests which have swept through the country in recent weeks. Momentum in the manufacturing sector’s downturn gathered pace, while most notably, the service sector’s resilience came to a halt, with business activity and demand dropping.
“Prior to the December flash results, survey data suggested that the French economy was set to record a fairly reasonable quarterly expansion in Q4. Having propped private sector growth up in recent months, contraction in the service sector presents significant downside risks to Q4 growth prospects.”
