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Macro EconomyMediumUpdated×2•Originally published 23 October 2026•Updated 23 October 2026•
4 min read

France’s Composite PMI Falls to 48.4 in October as Activity Returns to Contraction

Key Facts

1France’s preliminary composite Purchasing Managers’ Index fell to 48.4 points in October from 51.1 points in September, compared with a forecast of 50.5 points.
2The preliminary services index stood at 48.4 points, compared with 51.2 points in September and a forecast of 50.7 points.
3The preliminary manufacturing index was 49.3 points, below September’s reading of 50.6 points and the forecast of 50.5 points.
4The employment climate index fell 3 points to 95 in October, below its long-term average of 100.

France’s preliminary composite Purchasing Managers’ Index fell to 48.4 points in October from 51.1 points in September, missing the market forecast of 50.5 points, according to InvestingLive’s summary of the S&P Global report published on October 23. The reading returned the private sector to contraction after September’s rebound, with the 50-point mark separating growth from contraction in activity. Weakness was not confined to the composite index: the preliminary services reading was 48.4 points, compared with 51.2 points in September and a forecast of 50.7 points. The preliminary manufacturing index also fell to 49.3 points from 50.6 points the previous month, below the forecast of 50.5 points. All three readings indicate that the downturn spanned services and manufacturing, with manufacturing remaining closer to the stability threshold.

Companies linked the decline to the sharpest fall in demand for French goods and services since May, attributing it to rising uncertainty and economic pressures, according to the report summary. Manufacturers and service providers said demand fell at a faster pace, as projects were postponed and customers held back from making decisions. That puts weak demand at the heart of companies’ explanation for October’s decline in activity, following the composite index’s improvement in September. The durability of that rebound had been in question since its release; Joe Hayes said, according to the September report cited by Reuters via Investing.com, that "the sustainability of this expansion is in question, as new orders barely rose." The warning coincided with a decline in companies’ expectations for activity, underscoring the fragility of the previous improvement in demand.

The composite index of companies’ expectations for the coming year fell to its lowest level since April 2020, according to the summary, signaling that business sentiment turned negative for the first time in nearly two years. The reading matters alongside the decline in demand, as project delays and customers’ reluctance to make decisions coincided with a worsening outlook for future activity. Meanwhile, the survey’s price indicators eased between September and October, as inflation in input costs and prices charged by companies slowed. The services sector was the main driver of that slowdown, while manufacturers faced stronger price pressures. The survey therefore combined contracting activity and lower price pressures in services with manufacturing price pressures following a different trajectory.

Business climate indicators from France’s National Institute of Statistics and Economic Studies (INSEE) offer a parallel picture that is less severe than the Purchasing Managers’ Index survey. The overall business climate index rose one point in October to 97 points, moving closer to its long-term average of 100, according to INSEE. The index the institute reports for all sectors also came in at 98 points, while the business climate index for services stood at 99 points. In the labor market, the employment climate index fell 3 points to 95, below its long-term average of 100. The institute attributed the decline in the employment index to weaker employment expectations in services excluding temporary work, contrasting with the slight improvement in the overall business climate index.

The activity reading comes as national accounts showed French gross domestic product was unchanged in the second quarter of 2026, after contracting 0.2% in the first quarter, according to INSEE. The institute listed October 30 as a subsequent release date, while Eurostat’s calendar schedules the release on the same day of the European Union’s and euro area’s preliminary third-quarter GDP estimate. This places the next GDP data among the upcoming milestones for tracking the French and European economies after October’s mixed indicators. Until then, the available signals combine private-sector contraction in the Purchasing Managers’ Index survey with a slight improvement in France’s business climate according to INSEE. The gap between the two readings was clear: the business climate index remained below its long-term average, while the composite Purchasing Managers’ Index fell below the contraction threshold.