November 6, 2018 / 9:04 AM / 9 months ago

French services pick-up boosted by new business flows in October: PMI

The skyline of La Defense business district is seen from the Airparif Generali Balloon which flies over the Park Andre-Citroen in Paris, France, September 18, 2018. REUTERS/Charles Platiau

PARIS, Nov 6 (Reuters) - - French service sector activity picked up in October as companies stepped up hiring in the face of an increase in new business, a monthly survey showed on Tuesday.

Data compiler IHS Markit said its purchasing managers index for services rose in October to 55.3 from 54.8 in September, although this was worse than a preliminary reading of 55.6.

The index rose further away from the 50-point threshold dividing an expansion in activity from a contraction.

IHS Markit’s overall PMI index, which includes the services and manufacturing sectors, rose marginally to 54.1 from a 21-month low of 54.0 in September, worse than the 54.3 originally reported.

In France’s dominant service sector, companies took on new workers at the fastest pace since February while the flow of new business was the best since April.

“Panellists often mentioned strong demand conditions in their reasoning for increases,” IHS Markit economist Eliot Kerr said.

However, optimism for the future eased slightly as input prices continued to grow much faster than service providers’ selling prices, squeezing their margins.

Reporting by Leigh Thomas; Editing by Toby Chopra;; +33 1 4949 5143

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