2024-01-04 10:29:25
This is the seventh consecutive month of contraction in private sector activity.
Private sector activity in France recorded a new “marked” contraction in December due to a weakening of demand, according to the PMI index published Thursday by the S&P Global firm and the Hamburg Commercial Bank (HCOB).
The composite indicator recovered slightly to 44.8 in December, compared to 44.6 in November, but remains below the threshold of 50 which distinguishes areas of contraction and expansion of activity.
This is the seventh consecutive month of contraction in private sector activity.
Downsizing in December
The survey data showed “a sharp decline in the overall volume of new business across the private sector, a trend that notably reflected a significant decline in export sales, particularly in the manufacturing sector,” S&P said in a press release.
Although a little more optimistic regarding their activity prospects, private companies reduced their workforce in December, “employment having declined for only the second time in more than three years”, underlined S&P.
Weakened demand
In the services sector, the weakening of demand in France and abroad weighed on activity. The PMI indicator rose to 45.7 in December, compared to 45.4 in November.
“Some respondents have also suffered the consequences of recent bad weather (floods in particular) which have reduced attendance levels at their establishments,” according to S&P.
On Tuesday, the cabinet reported “strong contractions” in production and new orders in French manufacturing activity, whose PMI index fell from 42.9 in November to 42.1 in December.
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