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France: Private Sector Implosion Continues

  • Written by Syndicated Publisher No Comments Comments
    May 26, 2013

    Here’s some news that caught my eye earlier today when I was on the road: The Markit Flash France PMI® shows French private sector output continues to fall at marked rate in May.

     Key points:
    • Flash France Composite Output Index unchanged at 44.3
    • Flash France Services Activity Index unchanged at 44.3
    • Flash France Manufacturing PMI rises to 45.5 (44.4 in April), 9-month high
    • Flash France Manufacturing Output Index up to 44.3 (44.1 in April), 9-month high

    Summary:

    The downturn in French private sector output continued in May. Unmoved from April’s reading, the Markit Flash France Composite Output Index, based on around 85% of normal monthly survey replies, posted 44.3. Although remaining above the levels registered in Q1, the latest reading was indicative of a marked rate of contraction in overall activity.

    Comment:

    Jack Kennedy, Senior Economist at Markit and author of the Flash France PMI®, said:
    “May’s unchanged PMI reading points to ongoing struggles for the French private sector economy. Activity has continued to fall at a marked pace in Q2 so far, suggesting that another drop in GDP could well be on the cards following the recent confirmation that France was in recession during the previous two quarters. PMI data highlight continued pressure on employment and operating margins, as the difficult business climate facing French companies persists.”

    Mish Comments

    Scores below 50 designate contraction, and scores in the 44-range designate substantial contraction, so those 9-month highs just go to show how awful conditions are.

    With French president  Francois Hollande at the helm of France, and the nannycrats in Brussels in control elsewhere, don’t expect conditions to get much better any time soon.

    Read more at

    http://globaleconomicanalysis.blogspot.com/2013/05/france-private-sector-implosion.html#Dc61T2oYrLpbO5JU.99

    Images: Flickr (licence attribution)

    About The Author

    Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.  Visit Sitka Pacific’s Account Management Page to learn more about wealth management and capital preservation strategies of Sitka Pacific.

    You are currently viewing my global economics blog which typically has commentary every day of the week. I am also a contributing “professor” on Minyanville, a community site focused on economic and financial education.  Every Thursday I do a podcast on HoweStreet and on an ad hoc basis contribute to many other sites.

    When not writing about stocks or the economy I spend a great deal of time on photography and in the garden. I have over 80 magazine and book cover credits. Some of my Wisconsin and gardening images can be seen at MichaelShedlock.com.
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