Finance
French business activity contracts much more than expected in February, PMI shows
Published by Global Banking and Finance Review
Posted on February 21, 2025
2 min readLast updated: January 26, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on February 21, 2025
2 min readLast updated: January 26, 2026
French business activity contracted sharply in February, with the services sector leading the decline. The PMI hit a 17-month low, indicating continued economic challenges.
PARIS (Reuters) - French business activity slumped much more than expected in February, according to a survey published on Friday, as new business and backlogs in the dominant services sector sharply declined.
The HCOB France flash purchasing managers index (PMI) for services, compiled by S&P Global, came in at 44.5 points in February.
That figure represents a 17-month low for the euro zone's second-biggest economy and the index has now stayed below the 50 points threshold separating growth from contraction the sixth month running.
A Reuters poll forecast for the February flash services PMI stood at 48.9 and the final January figure was at 48.2.
The flash manufacturing PMI on the other hand rose to 45.5 points - a 9-month high - from 45.0 in January, and matching the Reuters poll forecast.
Overall though the flash December composite PMI - which comprises both the services and manufacturing sectors - tumbled to 44.5 points from 47.6 in January, well below a forecast of 48.0 points.
That rate of decline, more than three points, was the steepest since September 2023.
"Recession with no end in sight. The HCOB French Flash PMI in February failed to provide any relief. Surprisingly, it was the services sector, not the manufacturing sector, that caused the latest decline," said Dr Tariq Kamal Chaudhry, economist at Hamburg Commercial Bank.
Last month, the French government cut its 2025 economic growth forecast to 0.9% from 1.1% and said it would target a 2025 public deficit of 5.4% of GDP.
(Reporting by Benoit Van Overstraeten; Editing by Toby Chopra)
The HCOB France flash purchasing managers index (PMI) for services came in at 44.5 points in February.
The February PMI represents a 17-month low and has remained below the 50 points threshold for six consecutive months.
Last month, the French government cut its 2025 economic growth forecast to 0.9% from 1.1% and targeted a public deficit of 5.4% of GDP.
The flash manufacturing PMI rose to 45.5 points in February, a 9-month high, matching the Reuters poll forecast.
The composite PMI tumbled to 44.5 points from 47.6 in January, indicating a significant decline in overall business activity.
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