France PMI manufacturing recovered back to 51.2 in January, up from 49.7 and beat expectation of 50.0. However, PMI services dropped to 47.5, down from 49.0 and missed expectation of 50.5. That’s also the lowest level in 59 months. PMI composite dropped to 47.9, down from 48.7, hitting a 50-month low.
Commenting on the Flash PMI data, Eliot Kerr, Economist at IHS Markit said:
“Private sector firms in France reported a further contraction in output during the opening month of 2019. The latest decline was the fastest for over four years, even quicker than the fall in protest-hit December. The strong service sector that had supported a weak manufacturing sector in the second half 2018 declined at a faster rate in January. Meanwhile, manufacturers recovered to register broadly-unchanged production.
“Despite the continuation of ‘gilets jaunes’ protests, it is unclear whether the latest weak performance was caused by the resulting disruption, or whether the anticipated global economic slowdown for 2019 is already beginning to take hold.
“Although firms reported higher confidence in January, other forward looking indicators such as new orders fell at the fastest pace for over four years. This suggests further weak performance for France in the coming months.”
