In March, French business activity continued its downward trend for the tenth consecutive month, as revealed by a monthly survey indicating a decline in demand for French goods and services alongside a reduction in employment.
According to the HCOB flash purchasing managers index (PMI) for France’s services sector, compiled by S&P Global, there was a decrease to 47.8 from 48.4 in February, falling short of the 48.7 forecast in a Reuters poll.
Similarly, the flash manufacturing PMI dropped to 45.8 points, lower than the Reuters poll forecast of 47.5 points and February’s final manufacturing PMI of 47.1. Any figure below 50 indicates contraction, while a figure above 50 signifies expansion in activity.
The flash composite PMI, which encompasses both the services and manufacturing sectors, decreased to 47.7 points from 48.1 in February, missing the Reuters poll forecast of 48.6.
Economist Norman Liebke from Hamburg Commercial Bank commented, “The French economy is delaying its recovery into at least the second quarter.”
The French economy, being the second largest in the eurozone, is anticipated to witness zero growth in the first quarter, as stated by the official statistics agency INSEE last week.
However, it is expected to experience a modest expansion of 0.3% in the second quarter. In response to economic projections, Paris adjusted its 2024 growth forecast from 1.4% to 1%, following a 0.9% expansion recorded last year.
