• Composite PMI 51.7 vs 50.6 prelim

A modest revision higher to initial estimates but the services reading is still the weakest since January with new business growth slumping to a 15-month low. That highlights worsening demand conditions and marks a significant headwind to the French economy to start Q3. S&P Global notes that:

„The services economy is clearly on a downward path as growth slumped to its weakest rate since the Omicron disruption at the start of 2022.

„Taking this in tandem with the steep drop in French manufacturing output, the French economy recorded its weakest performance since April 2021 in July. It’s clear that high inflation in Europe is damaging demand, with panel comments from both surveys highlighting hesitancy among clients at current price levels.

„The outlook for the French economy has been clouded further this past week as risks of an energy supply crisis in Europe grow. Coupled with rising interest rates and stubbornly high inflation, it’s difficult to foresee the French economy breaking out of its current downward trajectory.”