FX.co ★ France Services Sector Shrinks Less than Expected

In July 2025, the HCOB France Services PMI recorded a figure of 49.7, marginally surpassing market predictions and June's reading of 49.6, according to preliminary estimates. This indicates the eleventh consecutive month of contraction within the services sector, albeit at the mildest decline during this period. Although output decreased at a slower rate, new orders experienced the sharpest drop seen in three months. Meanwhile, French companies' projections for the coming year significantly worsened, hitting their lowest point since November of the previous year due to constrained budgets, concerns regarding sales performance, and domestic political instability. In reaction to the bleak outlook, businesses further reduced employment during the month, with job cutbacks occurring exclusively in the services sector. Regarding costs, prices for services experienced only a slight increase, though the pace of this rise accelerated somewhat due to a renewed increase in factory gate prices.