French out­put slows as econ­omy nears stag­na­tion

The China Post - - BUSINESS INDEX & -

Growth in busi­ness ac­tiv­ity in France’s pri­vate sec­tor slowed in April amid signs that the eu­ro­zone’s sec­ond-big­gest econ­omy was on the verge of stalling, a key sur­vey showed Thurs­day.

The Pur­chas­ing Man­agers Out­put In­dex by Lon­don-based Markit Eco­nomics dropped to 50.2 points in April from 51.5 points the month be­fore.

The closely watched in­dex re­mained just above the 50-point mark that divides ex­pan­sion from con­trac­tion, and be­low the me­dian es­ti­mate for an in­crease to 51.8 in a sur­vey of econ­o­mists con­ducted by Bloomberg.

Ser­vice sec­tor growth al­most stag­nated and fac­tory out­put moved fur­ther into decline along­side an in­creased loss of ex­port or­ders and slug­gish do­mes­tic de­mand, Markit said in a state­ment.

“Out­put growth stut­tered al­most to a halt in April, sig­nal­ing a con­tin­u­a­tion of the mori­bund eco­nomic en­vi­ron­ment in France,” Markit econ­o­mist Jack Kennedy added.

The French econ­omy ex­panded at a slug­gish rate of 0.4 per­cent in 2014 as the gov­ern­ment bat­tled stub­bornly high un­em­ploy­ment.

Pres­i­dent Fran­cois Hol­lande has launched a two-pronged attack to tackle job­less­ness and push for growth.

The first is known as the Re­spon­si­bil­ity Pact, a se­ries of tax cuts for busi­nesses in re­turn for job cre­ation.

The sec­ond is a pack­age of re­forms aimed at open­ing up France’s closed econ­omy, in­clud­ing ex­tend­ing the num­ber of Sun­days per year when stores can open their doors.

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