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French private sector output rises to greatest extent for over 5 1/2 years

Staff Writer |
The Markit Flash France Composite Output Index, based on around 85% of normal monthly survey replies, registered 53.8, compared to December’s reading of 53.1.

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The latest figure pointed to a marked rate of growth that was the best since June 2011. Service sector activity increased for the seventh time in as many months during January.

Moreover, the rate of growth was the most marked in over a year-and-a-half. Meanwhile, manufacturing firms noted a fifth successive rise in output. The rate of growth remained marked, despite easing marginally from December’s 67-month high.

The level of new business received by private sector companies in France continued to rise in January, thereby extending the latest sequence of expansion to seven months. The increase was broad-based across both the services and manufacturing sectors, with the strongest rate of growth evident in the former.

Employment across the French private sector rose for a third consecutive month in January. Furthermore, the rate of job creation was the sharpest in over five years, albeit moderate overall. Staffing numbers rose in both sectors, with manufacturing companies noting the strongest rate of increase.

Outstanding business at French private sector firms increased in January, thereby continuing a trend that has been evident since March last year. Capacity pressures were evident in both services and manufacturing companies.

Input costs facing companies operating in the French private sector further increased during January. Moreover, the latest rise was the sharpest in over five-and-a-half years.

Higher cost burdens were evident in both sectors, although by far the sharper rise was signalled by manufacturers. Meanwhile, average selling prices fell for the fiftyseventh successive month.

That said, the rate of decline eased from the previous survey period and was fractional overall. An increase in output prices charged by manufacturing companies was more than offset by a drop in service sector charges.

Finally, private sector companies maintained a positive outlook towards activity over the coming 12 months. However, the degree of optimism weakened slightly from December. Optimistic panellists commented on new product launches and positive sales forecasts.

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