PARIS, Feb 2 (Reuters) - France's manufacturing downturn eased in January as new orders fell more slowly, a survey showed on Monday, but continued job cuts and price cutting pointed to persistent weakness in Europe's second-largest economy.
Data compiler Markit's final purchasing managers' index, which includes the services and manufacturing sectors, rose to 49.2 in January from 47.5 in December.
It was the highest reading in eight months, but still slightly lower than a preliminary reading of 49.5 and below the 50-point line dividing expansions in activity from contractions.
"The start of the new year brought some relief for French manufacturers, with output moving closer to stabilisation after a prolonged period of decline," said Markit Senior Economist Jack Kennedy.
But price cutting due to tough competition for business underscored "significant challenges amid a persistently fragile demand environment," he said.
Reporting by Alexandria Sage; Editing by Hugh Lawson