(Il Sole 24 Ore Radiocor) - Milano, 7 apr - In March, France's purchasing managers' index (PMI) for the services sector fell to 48.8 from 49.6 the previous month, according to data released by S&P Global.

The composite output index, a weighted average of services PMI and manufacturing output, also slipped to 48.8 from 49.9 the previous month, indicating the quickest drop in private sector business activity since last October.

A reading below 50 signals a sector contraction and one above an expansion.

"The resolution of the budget deadlock earlier this year has failed to provide France's economy with a springboard into higher growth during the first quarter, according to the latest PMI numbers. That said, the local elections in March provided yet another political event for businesses to contend with, so we may need to wait until April data to make concrete conclusions. The outbreak of war in the Middle East is also being felt in Europe, with survey respondents reporting a hit to demand due to the conflict," said Joe Hayes, principal economist at S&P Global Market Intelligence.

"However, prices were where the Middle East war showed up most starkly in the March PMI figures. Input price inflation accelerated sharply, hitting its highest level since July 2024 as the oil price shock drove fuel costs up across France.

"Much uncertainty lies ahead, a condition which French businesses have become rather accustomed to in recent years given the domestic political environment. Uncertainty is bad for growth, and the inflation impulse stemming from the war.

raises the risk of stagflation in France."

(RADIOCOR) 07-04-26 10:01:17 (0210) 5 NNNN