PARIS Aug 21 French business activity was stagnant
in August, a survey showed on Thursday, as an improvement in the
services sector could not fully offset the worst performance in
over a year in manufacturing in the euro zone's second-biggest
Data compiler Markit said its composite purchasing managers
index of activity in both the manufacturing and services sector
rose to 50.0 from 49.4 in July, hitting the 50-point line that
separates growth in activity from contraction.
"France isn't improving but it is stabilizing ... at least
that's a bit more positive than what we were seeing before,"
said Markit Senior Economist Rob Dobson, who nevertheless called
the manufacturing index "quite a weak reading."
"While services is having a mildly positive effect and is
coming back and showing some growth ... manufacturing continues
to be a real drag on the economy," Dobson said.
Markit's PMI index for the manufacturing sector slipped
further to 46.5 from 47.8, the worst performance since May 2013.
That fell short of economists' expectations on average for an
unchanged reading of 47.8.
Fewer new orders, from both the domestic and export markets,
weighed on the long-struggling sector.
A marginally brighter spot was services, where the index
rose to 51.1 from 50.4, outperforming expectations for a reading
of 50.0, helped in part by a slight strengthening in new
business for the first time in five months.
Dobson said that was hopefully a sign that the French
domestic market, while not actually improving, was at least
showing signs of stabilizing.
The French economy posted no growth in the three months to
June, the second quarter in a row of stagnation.
As a result, the Socialist government of President Francois
Hollande slashed its 2014 and 2015 growth forecasts last week.
It now targets 0.5 percent growth for this year, half its
(Reporting By Alexandria Sage; Editing by Toby Chopra)
- Detailed PMI data are only available under licence from
Markit and customers need to apply to Markit for a licence.
To subscribe to the full data, click on the link below: here
For further information, please phone Markit on +44 20 7260
2454 or email firstname.lastname@example.org