Finance
French services sector remains in contraction in February, PMI shows
Published by Global Banking & Finance Review®
Posted on March 4, 2026
2 min readLast updated: March 4, 2026
Quick Summary
France’s services sector stayed in contraction in February with a Services PMI of 49.6, reflecting continued weak demand—especially from abroad—and falling exports, although employment rose modestly and input‑cost inflation eased.
French Services Sector Remains in Contraction as PMI Shows Weak Demand in February
Overview of France's Services Sector Performance in February
PMI Data and Sector Activity
PARIS, March 4 (Reuters) - France's services sector remained in contraction territory for the second consecutive month in February, as demand weakened and exports fell sharply, a survey by S&P Global showed on Wednesday.
The final HCOB France Services PMI rose slightly to 49.6 in February from 48.4 in January but stayed below the 50.0 threshold that separates growth from contraction, indicating a very marginal slowdown in overall services sector activity.
Demand, Employment, and Sales Trends
Declining Demand and Export Performance
Demand for French services continued to decline, marking the third consecutive month of weakening sales, particularly from international clients. Despite this, employment in the sector saw a modest increase for the second month in a row, with the rate of job creation reaching a four-month high.
Expert Commentary
"France's private sector is lacking momentum. Although the composite index has edged up slightly, the overall level remains far from encouraging," said Hamburg Commercial Bank economist Jonas Feldhusen.
Outlook and Price Developments
Business Optimism and Future Prospects
Despite the current challenges, service providers remain optimistic about growth prospects over the next 12 months, driven by plans to launch new offerings and expand client bases.
Input and Output Price Trends
Input price inflation eased to a four-month low, although firms reported higher costs for hardware and fuel. Output prices increased marginally as companies attempted to pass on these costs to customers.
Composite PMI and Private Sector Activity
Combined Manufacturing and Services Data
The composite PMI, which combines both manufacturing and services sectors, rose to 49.9 in February from 49.1 in January, indicating private sector business activity held steady.
Reporting and Editorial Credits
(Reporting by Makini Brice; Editing by Hugh Lawson)
Key Takeaways
- •The final S&P Global HCOB France Services PMI edged up to 49.6 in February from 48.4 in January, but remained below the 50.0 threshold, signaling continued contraction. (Sources: Reuters summary, TradingEconomics) (wkzo.com)
- •Demand continued to decline for the third straight month, with exports slumping at the steepest pace since December 2024, while new business inflows dropped sharply. (Source: TradingEconomics composite PMI breakdown) (tradingeconomics.com)
- •Despite overall weakness, employment in services rose modestly, reaching a four‑month high, and input price inflation slowed to its lowest level in four months—even though hardware and fuel costs remained elevated. (Derived from article summary and underlying data) (tradingeconomics.com)
References
Frequently Asked Questions about French services sector remains in contraction in February, PMI shows
1What was the French services PMI in February?
The French services PMI rose slightly to 49.6 in February, up from 48.4 in January, but remained in contraction territory.
2Why did France's services sector remain in contraction?
The sector remained in contraction due to weakened demand and a sharp fall in exports, especially from international clients.
3How did employment in France's services sector perform?
Employment saw a modest increase for the second consecutive month, reaching a four-month high in job creation.
4What happened to input and output prices in the French services sector?
Input price inflation eased to a four-month low, while output prices increased marginally as firms passed higher costs onto customers.
5What is the outlook for the French services sector?
Service providers are optimistic about growth prospects over the next 12 months, driven by new offerings and expansion plans.
