PARIS (Reuters) – Activity in the French private sector continued to contract in July, with the manufacturing and services sectors even coming out below expectations, heightening fears of a recession, preliminary results of surveys of purchasing managers carried out by S&P Global showed on Monday.
The composite index calculated by Markit and HCOB, which incorporates the manufacturing and services sectors, fell this month to 46.6, compared to 47.2 in June and 47.8 expected by the consensus of economists.
The bar of 50 separates growth and contraction of activity.
“The data points to a noticeable slowdown in the economy, reflecting the biggest decline in business activity since November 2020, which preceded a contraction in GDP,” said Norman Liebke, economist at Hamburg Commercial Bank (HCOB).
The services-only index came in at 47.4 this month, the lowest since February 2021, down from 48.0 in June and consensus expectation of 48.4.
The index was penalized by weak demand according to the survey.
That of the manufacturing sector fell to 44.5, the lowest since the start of the COVID-19 pandemic, after 46.0 in June and a consensus of 46.0.
“The decline in new export-related business was even more pronounced, reflecting weak global demand, as China’s economy so far has not rebounded as expected,” the HCOB economist added.
(Reportage Tassilo Hummel; Claude Chendjou, edited by Kate Entringer)
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