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French private-sector growth slows in April: PMI
[PARIS] French private-sector growth slowed in April as the service sector's expansion weakened and a slowdown in manufacturing worsened, a survey showed on Wednesday.
The composite Purchasing Managers Index (PMI), an aggregate of services and manufacturing, dipped to 50.6 in April from 51.5 in March. That kept it just above 50, the line separating expansion from contraction, for a third straight month.
The pattern was similar in services, where the PMI score was above 50 for a third month running but dropped back to 51.4 in April from 52.4 in March. "This reflected flagging new business growth, with even another round of marked output price reductions insufficient to prevent a further slowing," said Jack Kennedy, senior economist at Markit, a consultancy that collates the survey data. "On the brighter side, business expectations improved to the highest level for over three years, while employment registered another slight gain, suggesting that companies are cautiously hopeful of an improving situation in the coming months." A PMI report last week showed French manufacturing activity shrank for a 12th straight month in April and the contraction worsened from the previous month, with a PMI score of 48.0 in April after 48.8 in March.
President Francois Hollande and his Socialist government, now three years into a five-year term, are keen to secure a so-far elusive drop in the stubbornly high French jobless rate of around 10 per cent. They need an acceleration in economic growth to do that.
Economists believe the economy, now slowly pulling out of the doldrums, may not grow fast enough for much of this year to make any real dent in unemployment.