PARIS (Reuters) – French business activity grew in April at the fastest pace in more than four years, a monthly survey showed, as the euro zone’s second-biggest economy benefited from fewer COVID-19 restrictions, more job creation and higher orders.
Nevertheless, inflation remained a concern for many French businesses, S&P Global said in its monthly purchasing managers’ survey, released on Friday.
S&P Global said its April flash services PMI reading for France stood at 58.8 points – up from 57.4 in March and beating expectations for a reading of 56.5 points.
Any reading above 50 indicates growth.
The flash manufacturing PMI for April rose to 55.4 points from 54.7 in March, also beating a forecast of 53.0 points.
The overall flash composite PMI for April – which combines the services and manufacturing sectors – rose to 57.5 points from 56.3 in March, also topping forecasts.
S&P Global said the flash April PMI numbers for the services index and the composite index marked their highest levels in more than four years.
French equities and bonds have also been boosted over the last week by expectations that Emmanuel Macron will beat far-right rival Marine Le Pen on Sunday and be re-elected as the country’s president. Still, inflation continues to cast a shadow over the French and global economies.
“The strongest increase in economic output for over four years suggests there was still plenty of COVID catch-up at the start of the second quarter. Indeed, comments from our panel members back this up, with many linking this to an increase in their orders,” said S&P Global senior economist Joe Hayes.
“Given how rampant inflation is at present, it’s difficult to see sustained post-pandemic recovery efforts offsetting the negative impact from rising prices,” added Hayes.
(Reporting by Sudip Kar-Gupta; Editing by Susan Fenton)
