PARIS (Reuters) - French business activity weakened by more than forecast in July compared to June, and fell to a three-month low as shortages of materials and transportation delays impacted firms, according to a survey published on Friday.
Data compiler IHS Markit said its preliminary composite Purchasing Managers Index (PMI) fell to 56.8 points in July from 57.4 in June - its lowest figure in three months.
The July figure also came in below a forecast for 58.5 points, although it remained well above the 50-point threshold dividing an expansion in activity from a contraction.
The preliminary July PMI reading for France's dominant services sector fell to 57.0 points from 57.8 in June, missing a forecast for a reading of 58.7 points.
The flash PMI for France's manufacturing sector fell to 58.1 points in July from 59.0 in June - also below a forecast for 58.4.
"Given the sharp increases in new orders that PMI data are signalling, the only hindrance to sustaining strong rates of output growth will be on the supply-side. Backlogs of work were accumulated once again in July as firms struggled to meet unrelenting demand pressures amid looser lockdown measures and subsequent economic recovery efforts both domestically and overseas," said IHS Markit senior economist Joe Hayes.
"This was compounded by continued shortages of inputs and poor freight availability, leading to the fastest rate in cost inflation since May 2011," added Hayes.