France September flash services PMI 53.0 vs 50.5 expected

• Prior 51.2
• Manufacturing PMI 47.8 vs 49.8 expected
• Prior 50.6
• Composite PMI 51.2 vs 49.8 expected
• Prior 50.4

It's a mixed report as the French services sector showed some improvement, with the headline reading coming up to a two-month high. However, the manufacturing sector slumped with the reading itself falling to its lowest in 28 months. That said, the overall underlying trend in output remains weak with the manufacturing downturn sparked by high inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term, overstocked warehouses and weakening demand. S&P Global notes that:

“The upward movement in the Composite Output PMI should not take away from the clear message seen across the survey as a whole – the French economy is struggling. Weakness is its most striking in the manufacturing sector, where the downturn accelerated in September as overstocked warehouses, rapidly deteriorating demand for goods, heightened economic uncertainty and intense price pressures drove production volumes lower.

“Another worrying find from the latest survey was the pickup in inflationary pressures, despite more evidence that supply stress is fading. According to surveyed firms, this reflected higher energy tariffs and wage bills. Energy security is a principal concern of companies as we head into the colder months across Europe.

“The overall improvement in September was servicesdriven as a renewed increase in new business supported a slight pick-up in activity growth. Nevertheless, trends in output and new orders on the services side were still subdued by historical standards. Given the large degree of weakness we’re seeing in the manufacturing sector, it’s likely that we’ll see some of this spill over into services, thereby raising the risk of a recession in France.”