French business activity booms as lockdown eased in May – PMI

French business activity surged in May as a coronavirus lockdown was eased, firing up the dominant service sector, a monthly survey showed this week.

Data compiler IHS Markit said its purchasing managers index for services rose to 54.8 from 50.9 in April, unchanged from a preliminary reading.

The re-opening of schools, non-essential stores and cafes helped the index reach its highest level since April 2018 and lifted it comfortably above the 50-point threshold dividing an expansion in activity from a contraction.

IHS Markit’s overall PMI index, which includes the services and already published data from the manufacturing sector, rose to 57.0 from 51.6 in April, unchanged from a preliminary reading.

“Stronger demand, particularly from the domestic market, underpinned the uplift,” IHS Markit economist Shreeya Patel said.

“That said, output was somewhat hindered by capacity constraints after a softer increase in headcounts contributed to a marked rise in backlogs,” she added. 

Photo: People take pictures in front of the Triumph Arch at the Champs Elysees in Paris, France. EPA/CHRISTOPHE PETIT TESSON