PARIS – French business activity has expanded at a slower pace in December compared with last month, an initial estimate in a monthly survey of purchasing managers showed on Thursday, a trend partly due to the Omicron COVID-19 variant.
Data compiler IHS Markit said that its flash composite PMI index for December, which includes both the services and manufacturing sectors, stood at 55.6 points.
While readings above 50 points point to positive overall business expectations, the latest print marked a slight drop from the 56.1 recorded in November, although it still beat the consensus forecast in a Reuters poll of analysts of 55.0 points.
“A new wave of COVID-19 infections and the emergence of the Omicron variant reportedly weighed on the upturn”, said IHS economist Joe Hayes.
The reading for growth in France’s dominant services sector edged down to 57.1 points from 57.4 in November, but it beat a forecast for 56.0 points.
The flash PMI for the manufacturing sector in December fell 54.9 points, down from 55.9 points in November and falling short of the 55.5 points seen by analysts.
IHS said that overseas demand fell at the fastest pace since January.
“The drop in new foreign client business was particularly pronounced at service providers as the emergence of the Omicron variant dented tourism”, Hayes said, adding that the manufacturing sector was still experiencing shortages of raw materials and components.
“Late deliveries of inputs and delayed production schedules were commonly cited factors by survey respondents,” he added.
(Reporting by Tassilo Hummel; Editing by Hugh Lawson)
