France PMI November 2020


France: Private sector activity declines at quickest rate in six months in November

November 23, 2020

The seasonally-adjusted IHS Markit Flash Composite Purchasing Managers’ Index (PMI) plunged to 39.9 in November, from 47.3 in October, marking the worst reading since May. As such, the index dropped further below the 50-threshold that separates contraction from expansion in business conditions, pointing to deteriorating economic backdrop.

November’s reading largely reflected the reimposed lockdown measures and was mainly driven by falling output in the services sector. Activity in the manufacturing sector contracted for the first time in six months, albeit the decline was moderate overall. Moreover, new orders dropped sharply in both sectors as demand weakened due to the uncertain Covid-19 outlook. With regard to employment, French firms continued to cut staff levels in November amid reduced output requirements; however, the pace of job shedding softened compared to the previous month. On the price front, although input costs continued to rise in the month due to higher raw materials prices, inflation eased to a five-month low. Meanwhile, output charges fell as firms continued to cut prices. Lastly, businesses turned slightly more optimistic in November, as firms believed a Covid-19 vaccine would be available in 2021.

FocusEconomics Consensus Forecast panelists see fixed investment expanding 7.3% in 2021, which is down 0.7 percentage points from last month’s estimate, and 4.3% in 2022.

Author:, Economist

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France PMI Chart

France PMI November 20 20 0

Note: Markit Purchasing Managers’ Index (PMI). Readings above 50 indicate an overall increase compared to the previous month, and below 50 an overall decrease.
Source: IHS Markit.

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