Final PMI: French Private Sector Rebounds in August After Three Months of Contraction

French Private Sector Activity Ends Three Months of Contraction

PMI Rises to 50.4, Highest Since April

The French private sector ended three successive months of contraction in August, rising to its highest level since April due to a pick up in service sector activity.

The S&P Global Purchasing Managers' Index (PMI) for France climbed to 50.4 in August from 49.9 in July, showing the first expansion since May. The reading came in better than the flash estimate of 50.3.

The rebound was primarily driven by a pickup in the services sector, where the PMI rose to 51.2 from 49.8, indicating the first expansion since May.

New orders rose for the first time in four months, with the index climbing to 50.7.

However, manufacturing activity remained in contraction territory, with the PMI falling to 49.1 from 49.6, the fourth consecutive month below the 50 level.

Employment in the private sector also contracted, as the PMI dropped to 48.5 from 49.0.

The improvement in service sector activity was attributed to increased business travel and tourism activity during the summer months.

The pickup in new orders suggests that demand is recovering, which is a positive sign for the French economy. However, the continued contraction in manufacturing and employment indicate that the recovery is still fragile.

Source: PMI France: Private sector activity rebounds in August after three months of contraction