France composite PMI touches 10-month high in July as services pick up pace

France’s services sector picked up pace during the month of July, pushing the country’s composite Purchasing Managers’ Index (PMI) to 10-month high. However, manufacturing dripped for the sixth straight month in July.

France’s composite Purchasing Managers’ Index climbed to a 10-month high of 51.6 from 50.1 in July, data released by IHS Markit showed Tuesday. The factory gauge slipped to 48.5, below the 50 level that divides expansion from contraction.

Further, the services PMI rose to 52 in August, the highest since October, from 50.5, the data showed.

"France's private sector economy gathered some momentum in August, raising hopes of a pick-up in GDP growth after the stagnation seen in the second quarter. A stronger contribution from the service sector bolstered overall output, while manufacturing held its ground to halt a recent slide," said Jack Kennedy, Senior Economist, IHS Markit on Tuesday.

While the French economy failed to gather momentum in the second quarter, the Bank of France expects growth to resume in the three months through September. However, IHS Markit remained cautious on the outlook, however, citing moderate growth in new business at companies.

Meanwhile, the Markit Eurozone flash PMI index dipped to a three-month low of 51.8 from 52.0 previously, while the services-sector index hit a three-month high of 53.1 from 52.9 previously.