French architecture in France

France PMI August 2020

France: Composite PMI drops in August

The seasonally-adjusted IHS Markit Composite Purchasing Managers’ Index (PMI) dropped to 51.6 in August, down markedly from July’s 57.3. Although the index still remained above the 50-threshold that separates expansion from contraction in business conditions, the result indicates that the economic recovery lost traction midway through the third quarter.

August’s reading largely reflected a slowdown in activity in both the manufacturing and services sectors. Moreover, aggregate new order growth lost traction amid uncertainty over the duration of the Covid-19 health crisis and as international sales continued to decline. Consequently, firms lowered employment and cut staff levels at a faster pace compared to July. Lastly, although French firms were still optimistic about the outlook for the coming 12 months, confidence dropped to a three-month low in August due to linger uncertainty with regards to the pandemic.

Commenting on the reading, Eliot Kerr, economist at IHS Markit, noted:

“The latest PMI data came as a disappointment following the sharp rise in private sector activity seen during July, which had spurred hopes that the French economy could undergo a swift recovery towards precoronavirus levels of output. However, with activity growth easing considerably in the latest survey period, those hopes have been dashed and it is more likely that July was a temporary shock driven by a marked increase in the number of reopening businesses. Going forward, we can expect a steadier expansion, but even that comes with the risk of another sharp downturn if infection rates accelerate sufficiently for the government to impose another lockdown.”

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest X Download Fullscreen