France Experiences Lesser Traction in Business in August than Expected
Business activities in France have lost more momentum than what was expected in August, as stated by a survey on Friday, as labor worked in backlogs during the lockdown due to pandemic.
IHS Markit, a data compiler said its primary Purchasing Managers Index (PMI) fell from 57.3 points to 51.7 in July – far below the typical forecast for 57.2 during a Reuters poll of economists.
The points for the services sector were above 50 points dividing expansion from a contraction, but the initial readings from the manufacturing industry came in below that level.
The primary service sector saw its PMI reading for August fall from 57.3 points to 51.9 in July, below a forecast for a reading of 56.3 points.
The manufacturing PMI fell to 49.0 points in August – down from 52.4 in July and under a forecast for 53.7 points.
Business activities in France had surged after the Euro zone’s second-biggest economy emerged in May from one of the hardest lockdowns in Europe as corporations skilled pent-up client demands.
The PMI survey in August indicated that backlogs were not growing in the service sector and were growing at a slower speed in manufacturing. Meanwhile, new order flow was stable in the services industry and slowed down in manufacturing, the survey showed.
The INSEE statistics agency said at the top of July that the French economy contracted by a post-war record of 13.8% within the second quarter thanks to the lockdown.