French services sector hits lowest level since late 2020
France's services sector contracted at its fastest pace since late 2020 in May as the Iran war drove up costs. The PMI fell to 44.3, signaling a Q2 GDP decline.
The France services sector contracted to 44.3 points in May, marking its sharpest decline since late 2020. This reading fell from 46.5 in April and represents the lowest level of activity since the height of the COVID-19 pandemic. The downturn raises the prospect of a second-quarter GDP contraction as geopolitical uncertainty and surging price pressures restrict decision-making.
### Recession Risks Mount as Demand Fades The S&P Global Inc France Services PMI final reading of 44.3 beat the flash estimate of 42.9 but remained well below the 50-point threshold separating growth from contraction. New business volumes also dropped, signaling that the downturn may persist. Joe Hayes, principal economist at S&P Global Market Intelligence, noted that current PMI levels are ringing recession alarm bells.
