• Prior 47.9
• Composite PMI 47.8 vs 47.3 prelim
• Prior 48.0

The slight revision higher doesn’t take away from the fact that French business activity has now contracted for eight straight months. Demand conditions remain subdued and that’s troubling amid a more challenging outlook in the months ahead. HCOB notes that:

“April marked another month of declining activity in the French private sector. The HCOB Composite PMI signals a continued downturn in economic activity in France, driven by weakness in the services sector. However, the manufacturing sector has managed to increase production for the first time in nearly three years.

“The French services sector remains on a downward trajectory. Business activity declined again in April, attributed to lower customer demand and generally poorer market conditions. The rapid decline in new orders is particularly concerning this month. Surveyed companies report that weak market conditions make it very difficult to attract new business, and existing customers are also hesitant to engage in new transactions. High trade policy uncertainty seems to be causing postponements to investment and consumption decisions.

“Current developments – weak demand amid high uncertainty – do not bode well for the profit margins of French service providers. Additionally, our survey results indicate that operating costs, appear to be rising faster than end prices, which have virtually stagnated due to competitive pressures.

“Future business expectations remain in the growth zone, but significantly below the historical average. Employees find themselves in a concerning situation, as they are increasingly at risk of job loss as workloads decrease due to the order slump and simultaneous reduction of backlogs.”

This article was written by Justin Low at www.forexlive.com.