The recovery of European industry is faltering, while the number of viral infections is rising again and governments are cautiously re-applying stricter Coronation policies. Activity in French industry fell unexpectedly in August, according to preliminary figures from the UK market researcher Markit. In Germany and the euro area, activity continued to increase, but at a slower pace than economists had anticipated.
The Purchasing Manager Index for the French industry was 49, from 52.4 a month earlier. A position above 50 is a sign of increasing activity, below which there is shrinkage. Economists had actually counted on a level of 53.
France, like several other euro-countries, is struggling with a resurgence of the pandemic. In the meantime, the government has also tightened up the measures to control the spread of the virus, although the authorities do not yet seem to be going as far as the first coronac wave. Earlier, the downgrading of the lockdown led to an increase in industrial activity.
For German industry, the yardstick for August was 53, from 51 in July. In the euro area as a whole, Markit recorded scores of 51.7 and 51.8 in these months. In the services sector, too, activity developed less positively than expected. With stocks of almost 52, a small 51 and over 50, French, German and European Services showed only limited growth.
Only in the United Kingdom, which had previously been hit much harder by the crisis, industry and services attracted more activity this month than economists had anticipated. For the British Industry, Markit assumes a score of over 55. The situation in the services sector is even slightly over 60.