Published by Global Banking & Finance Review®
Posted on December 16, 2024
1 min readLast updated: January 27, 2026
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France's services sector shrank in December, though contraction slowed. PMI rose to 48.2, beating expectations. Political instability remains a challenge.
PARIS (Reuters) - France's services sector shrank further in December, although the pace of contraction eased, according to a closely-watched business survey by S&P Global published on Monday.
The HCOB Services PMI Business Activity Index rose to 48.2 from 46.9 in November, surpassing analysts' expectations for a reading of 46.7, though still below the 50.0 threshold that indicates growth.
The broader French private sector also experienced a slight improvement, with the Composite PMI Output Index climbing to 46.7 from 45.9, beating the forecast of 45.9, despite manufacturing activity falling to a 55-month low of 39.6 from 41.1.
"The service sector remains in limbo. Apart from a brief period around the Summer Olympics in Paris, service providers have struggled to generate growth momentum," said Tariq Kamal Chaudhry, Economist at Hamburg Commercial Bank.
Political instability and weak demand conditions were highlighted by survey respondents as key challenges, contributing to a sharp reduction in employment.
Despite a modest improvement in business confidence, the outlook remains subdued amid ongoing political uncertainty, the survey showed.
(Reporting by Tassilo Hummel; Editing by Toby Chopra)
The article discusses the contraction of the French services sector in December, as indicated by the PMI survey.
The HCOB Services PMI rose to 48.2 in December, surpassing expectations but still indicating contraction.
Political instability and weak demand conditions are major challenges for the French economy.
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