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 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.
“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.
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 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.
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 by Makini Brice; Editing by Hugh Lawson)
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