FR: PMI Composite


Tue Apr 07 02:50:00 CDT 2015

Consensus Actual Previous
Composite - Level 51.7 51.5 52.2
Services - Level 52.8 52.4 53.4

Highlights
An already sluggish end to first quarter now looks even softer in the wake of the final PMI data for March. With the flash service sector PMI revised down 0.4 points to 52.4, a full point below its final February reading, the key composite output PMI was shaded a couple of ticks to stand at 51.5, some 0.7 points beneath its mid-quarter outturn.

As previously indicated, growth of both new business and backlogs slowed in services. Employment managed a small increase, its first rise of any size in some seventeen months, but while business expectations remained positive, they also dipped to their lowest level so far in 2015. Service sector input prices rose further in March but the rate of cost inflation was only modest and, more significantly, service provider charges continued to decline, albeit at their slowest rate in four months.

The downward revisions to both headline indices still leave the French economy on course for positive growth last quarter. However, any increase in total output looks likely to be well short of a probable solid gain in Germany and the widening performance gap within the Eurozone core remains a real problem for the region's policymakers.

Definition
The Composite PMI is produced by Markit and is based on original survey data collected from a representative panel of over 700 companies based in the French private sector economy. The final France Composite PMI follows on from the flash estimate which is released a week earlier and is typically based on at least 75 percent of total PMI survey responses each month.

The Services PMI is produced by Markit and is based on original survey data collected from a representative panel of over 300 companies based in the French service sector. The final France Services PMI follows on from the flash estimate which is released a week earlier and is typically based on at least 75 percent of total PMI survey responses each month.


Description
Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' manufacturing indexes, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.