France: Flash Composite PMI dips in June but still points to solid expansion in the private sector
June 26, 2017
The Markit Flash Composite Purchasing Managers’ Index (PMI) eased from a revised 56.9 (previously reported: 56.6) in May to 55.3 in June, contrasting market analysts’ expectations of a stronger 56.7. The print, which marks a decline from May’s six-year high, marks the twelfth consecutive month in which the index has risen. The indicator remains above the 50-threshold that separates expansion from contraction.
June’s print reflects a softer expansion in both manufacturing output and service sector activity. Activity among service providers rose for the twelfth consecutive month, a trend mirrored in the manufacturing sector. New orders increased in both sectors, which compelled manufacturing and services firms to raise staffing numbers, with the rate of job creation the fastest pace in almost 10 years. Backlogs of work increased for the 16th month running, though the rate of expansion slowed from May’s six-year high. Regarding price developments, input prices continued to increase while output prices declined for the first time in two months.
Commenting on June’s strong reading, economist Alex Gill said that, “a particularly upbeat talking point highlighted in the latest data was the sharpest rise in employment for almost ten years. This is welcome news for the newly elected government which has made reducing unemployment one of the main aims of its administration.”