Markit_FrenchPMI

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News Release

Purchasing Managers Index

MARKET SENSITIVE INFORMATIONEMBARGOED UNTIL: 0800 (UK Time) 23 November 2011

Markit Flash France PMI

Decline in French private sector output eases in November

Key points:

Flash France Composite Output Index(1)

rises to48.7 (45.6 in October), 2-month high

Flash France Services Activity Index(2)

climbs to49.3 (44.6 in October), 2-month high

Flash France Manufacturing PMI(3)

falls to 47.6(48.5 in October), 29-month low

Flash France Manufacturing Output Index(4)

drops to 47.2 (47.6 in October), 3-month low

Summary:French private sector firms reported a decrease inoutput for the second month running in November.However, the rate of contraction eased fromOctobers sharp pace and was modest overall. TheMarkit Flash France Composite Output Index,based on around 85% of normal monthly surveyreplies, remained below the 50.0 no-change markat 48.7, but was up from the two-and-a-half yearlow of 45.6 seen in the previous month.

Underpinning the rise in the headline index was aslower decline in service sector business activity

during November. The latest reduction was onlymarginal and much weaker than in October. Incontrast, manufacturing production continued tofall at a solid rate, with the latest drop the sharpestin three months.

In conjunction with

Trends in activity generally mirrored those for newbusiness in November. Overall levels of incomingnew work to the French private sector fell at aslower pace, cushioned by a weaker decline in newbusiness at service providers. However,manufacturers reported the fastest drop in neworders since April 2009, with data pointing tosubstantial falls in sales both domestically and

abroad. Anecdotal evidence suggested that adeteriorating economic climate had resulted in await-and-see attitude among customers, while therewere a number of reports of lower client spending.

The forward-looking new orders to stocks offinished goods ratio in manufacturing remainedunchanged from the 31-month low seen in October,pointing to a weak outlook for production in comingmonths. Correspondingly, purchasing activity wascut further, leading to the sharpest decline instocks of inputs for 21 months.

Meanwhile, service providers future expectationswere the weakest since March 2009, with panellistsciting the continuing Eurozone debt crisis and nextyears French presidential elections as factorscontributing to uncertainty.

Backlogs of work in the French private sectordecreased for a second consecutive month inNovember, albeit only slightly. Companiesnevertheless recorded a modest increase inemployment.

Input price inflation accelerated from Octobers23-month low in November to a solid pace, albeitone that remained well below the surveys long-runaverage. Service providers reported a strongerincrease in costs, while manufacturers noted amarginal rise following a fall in the previous month.

Similarly, output price inflation quickened to athree-month high, although remained modestoverall. Service providers and manufacturers bothsignalled increased charges in November.

Comment:

Jack Kennedy, Senior Economist at Markit andauthor of the Flash France PMI , said:

Novembers slower contraction in output offers adegree of reassurance following the alarminglysteep drop-off in October. The overall figures werehelped by a more resilient performance by the

service sector, where the decline in activity easedto a marginal pace. However, further deteriorationwas evident in the manufacturing sector, amidreports of weaker demand both within France and

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in export markets. Even in services there was

worrying evidence in the form of a fall in futureexpectations to the lowest for over two-and-a-halfyears. Based on the last two months PMI figures,

there appears to be an elevated likelihood that GDP

will contract in Q4.-Ends-

Economic growth Employment

35

40

45

50

55

60

65

70

'98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11

-1.75

-1.25

-0.75

-0.25

0.25

0.75

1.25

1.75

PMI Compos ite Output Index

GDP

GDP quarterly % changePMI

Source: Markit

35

40

45

50

55

60

65

70

'98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11

Manu factu ring Servi ces

50 = no change on prior month

Source: Markit For further information, please contact:

MarkitJack Kennedy, Senior Economist Rachel Harling, Corporate CommunicationsTelephone +44-1491-461-087 Telephone [email protected] Mobile +44-78-2789-1072

[email protected]

Note to Editors:

Final November data are published on 1 December for manufacturing and 5 December for services and composite indicators.

The France PMI (Purchasing Managers' Index) is produced by Markit Economics and is based on original survey data collected from arepresentative panel of 750 companies based in the French manufacturing and service sectors. The flash estimate is based on around 85%of total PMI survey responses each month and is designed to provide an accurate advance indication of the final PMI data.

The average differences between the flash and final PMI index values (final minus flash) since comparisons were first available in January2006 are as follows (differences in absolute terms provide the better indication of true variation while average differences provide a betterindication of any bias):

Average Average differenceIndex difference in absolute terms

France Composite Output Index(1) -0.1 0.5France Manufacturing PMI

(3)0.0 0.4

France Services Business Activity PMI Index(2)

-0.3 0.7

The Purchasing Managers Index (PMI) survey methodology has developed an outstanding reputation for providing the most up-to-datepossible indication of what is really happening in the private sector economy by tracking variables such as sales, employment, inventoriesand prices. The indices are widely used by businesses, governments and economic analysts in financial institutions to help betterunderstand business conditions and guide corporate and investment strategy. In particular, central banks in many countries (including theEuropean Central Bank) use the data to help make interest rate decisions. PMI surveys are the first indicators of economic conditionspublished each month and are therefore available well ahead of comparable data produced by government bodies.

Notes1. The Composite Output PMI is a weighted average of the Manufacturing Output Index and the Services Business Activity Index.

2. The Services Business Activity Index is the direct equivalent of the Manufacturing Output Index, based on the survey question Is thelevel of business activity at your company higher, the same or lower than one month ago?

3. The Manufacturing PMI is a composite index based on a weighted combination of the following five survey variables (weights shown inbrackets): new orders (0.3); output (0.25); employment (0.2); suppliers delivery times (0.15); stocks of materials purchased (0.1). Thedelivery times index is inverted.


In conjunction with
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4. The Manufacturing Output Index is based on the survey question Is the level of production/output at your company higher, the same orlower than one month ago?

Markit do not revise underlying survey data after first publication, but seasonal adjustment factors may be revised from time to time asappropriate which will affect the seasonally adjusted data series. Historical data relating to the underlying (unadjusted) numbers, firstpublished seasonally adjusted series and subsequently revised data are available to subscribers from Markit. Please [email protected].

About MarkitMarkit is a leading, global financial information services company with over 2,300 employees. The company provides independent data,valuations and trade processing across all asset classes in order to enhance transparency, reduce risk and improve operational efficiency.Its client base includes the most significant institutional participants in the financial market place. For more information, seewww.markit.com

About PMIsPurchasing Managers Index (PMI) surveys are now available for 32 countries and also for key regions including the Eurozone. They arethe most closely-watched business surveys in the world, favoured by central banks, financial markets and business decision makers for theirability to provide up-to-date, accurate and often unique monthly indicators of economic trends. To learn more go to

www.markit.com/economics.

The intellectual property rights to the Flash France PMI provided herein is owned by Markit Economics Limited. Any unauthorised use, including but notlimited to copying, distributing, transmitting or otherwise of any data appearing is not permitted without Markits prior consent. Markit shall not have anyliability, duty or obligation for or relating to the content or information (data) contained herein, any errors, inaccuracies, omissions or delays in thedata, or for any actions taken in reliance thereon. In no event shall Markit be liable for any special, incidental, or consequential damages, arising out ofthe use of the data. Purchasing Managers' Index

and PMI

are registered trade marks of Markit Economics Limited. Markit and the Markit logo are

registered trade marks of Markit Group Limited.


In conjunction with
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