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• Prior 48.0
• Composite PMI 50.4 vs 49.9 prelim
• Prior 47.7

Demand conditions are seen picking up, helping to bolster French services activity in November. Of note, this saw the first monthly expansion in new business since August 2024. Meanwhile, price pressures were rather benign so that isn’t going to do much to impact the ECB outlook. HCOB notes that:

“Finally, some positive news. For the first time in over a year, output in France’s private sector has increased. In November,
the Composite PMI climbed back above the growth threshold, driven by a notable rebound in services business activity.
However, manufacturing remains a drag on overall performance, posting its steepest fall in nine months and widening the
gap between the two sectors.

“The improvement in services is encouraging, yet it remains to be seen whether this is just a one-off uptick or the start of a
sustained recovery. The coming months will provide clarity. At least, order intakes are moving in the right direction, with
domestic demand improving and foreign orders stabilising.

“Against this backdrop, business expectations remained cautious and at a relatively low level, though they improved in
November. If the government manages to reach a budget compromise and reduce political uncertainty, household
consumption and business investment could benefit from a more stable policy environment.

“The lingering weakness in services is reflected in employment and outstanding business volumes. After months of subdued
activity, incomplete work volumes continue to shrink, prompting companies to halt recent hiring trends and slightly reduce
headcount. Given developments in the past months, employment growth is likely to remain modest in the near term.

“Price dynamics are broadly consistent with pre-COVID patterns, although the PMI for output prices slipped below the 50-
mark amid competitive pressures, leading some firms to cut prices.”

This article was written by Justin Low at investinglive.com.

• Prior 54.0
• Composite PMI 53.8 vs 53.2 expected
• Prior 53.1

Key findings:

• Rate of growth in new business reaches 19-month high
• Strongest uplift in activity since April 2023
• Inflationary pressures build

Comment:

Commenting on the PMI data, Nils Müller, Junior Economist at Hamburg Commercial Bank, said:

“Italy’s service sector gained traction in November, as the HCOB Business Activity Index climbed to 55.0 from 54.0 in
October, marking the sharpest rise in over two-and-a-half years. This momentum was underpinned by a surge in new
business, which grew at its fastest pace since mid-2024, driven by successful client acquisition. Export orders, however,
slipped back into contraction, with some firms reporting persistent global headwinds and weakness in the automotive sector.

“Hiring continued for a tenth consecutive month, though job creation remained marginal, it aligned with the long-run trend.
Firms reported some spare capacity, as backlogs declined slightly. On the pricing front, inflationary pressures intensified in
November, with input cost inflation rising to the steepest rate since June, fuelled by higher wages and energy expenses. At
the same time, service providers raised their charges to partially offset cost burdens.

“Expectations for the year ahead improved to a four-month high, supported by anticipated investment and new customer
wins, even if confidence remained below historical norms amid uncertainty over international demand and the
implementation of AI.

“The buoyant services performance lifted overall private sector growth. The HCOB Italy Composite PMI rose to 53.8 from
53.1 in October, its highest reading since April 2023. Manufacturing output contributed only modestly to growth, leaving
services as the clear engine of expansion. With demand strengthening and confidence improving, Italy’s economy enters
year-end on firmer footing, though inflation and subdued international demand remain key risks. Against this backdrop, we
expect Italian GDP to grow by 0.5% year-on-year in 2025 and 0.8% in 2026.”

This article was written by Giuseppe Dellamotta at investinglive.com.

The two countries are looking to strengthen trade ties and are likely to sign bilateral interdepartmental and business agreements during Putin’s visit.