France PMI

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France: Composite PMI recovers and jumps to highest level in three-and-a-half years

February 20, 2015

The composite Purchasing Managers’ Index (PMI) elaborated by Markit improved notably in February, climbing from a revised 49.3 in January (previously reported: 49.5) to 52.2. With February’s result, the composite PMI jumped above the 50-threshold that indicates expansion in business activity, after the indicator had remained in contractionary territory over the last nine months. According to Markit, “at 52.2, up from 49.3 in January, the latest index reading signalled the sharpest rate of growth in three-and-a-half years.”

According to Markit, the main driver behind February’s improvement was an increase in business activity in the services sector. The rate of expansion was the fastest since August 2011. Conversely, business activity in the manufacturing sector registered a further contraction. Markit reported that new businesses at French private sector firms rose for a third consecutive month, with growth centered in the services sector. In contrast, new orders in the manufacturing sector contracted over the previous month. Meanwhile, French manufacturers reported yet another decline in new export orders. Regarding employment, businesses maintained staff levels after cutting them for 15 consecutive months. On price developments, businesses continued to report a fall in output prices, while input prices remained stable over the previous month.

Markit concluded that, “February’s flash PMI data provided better news on the health of France’s private sector economy, suggesting that the first quarter could see an improvement in GDP growth following the anemic 0.1% rise in Q4.”

FocusEconomics Consensus Forecast panelists see fixed investment contracting 0.1% in 2015, which is unchanged from the previous month’s estimate. For 2016, the panel expects fixed investment to rebound and expand 1.6%.


Author:, Senior Economist

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France PMI February 2015

Note: Markit Purchasing Managers’ Index (PMI). A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction.
Source: Markit.


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