France May flash services PMI 56.6 vs 53.0 expected

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Latest data released by Markit – 21 May 2021

  • Prior 50.3
  • Manufacturing PMI 59.2 vs 58.5 expected
  • Prior 58.9
  • Composite PMI 57.0 vs 53.7 expected
  • Prior 51.6

This is an impressive report with beats all around as the services and composite readings are at 10-month highs. Meanwhile, the solid manufacturing reading is also helped by the strongest output index in 40 months as overall growth gathers momentum.

Supply shortages are still evident so that is feeding to higher input cost inflation still.

“The French private sector moved up a gear in May
as lockdown restrictions were eased and the
economy began to reopen. There was a clear
underlying improvement in demand as new work
expanded at the fastest rate in over three years,
while output expectations were the strongest since
the composite series was first available in July 2012.

“The service sector drove the overall acceleration in
growth during May, both in terms of output and new
orders, although manufacturing continued to register
comparatively faster rates of expansion.
Manufacturers remained hindered, however, by
ongoing supply shortages and delays, with average
lead times lengthening at one of the most marked
rates in the survey history.

“The latest survey also suggested that firms were
struggling to recruit enough extra staff to keep on top
of workloads. Employment rose at the slowest rate
in four months, while backlogs increased at the
strongest pace in over three years.”

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