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French business activity hit a fresh six-year high in April, pointing to surprising economic strength in the eurozone’s second largest economy as the country heads for the polls in a closely-fought election.
Two days ahead of the first round presidential vote on Sunday, IHS Markit’s latest monthly survey of French businesses hit 57.4, leaping from 56.8 and defying expectations of pullback in April.
Markit’s survey of purchasing managers measures output, expectations and employment across the service and manufacturing sectors. Any PMI reading above 50 indicates growth with France’s private sector now expanding for 10 consecutive months.
The French economy has historically lagged behind major rival Germany since the eurozone’s sovereign debt crisis hit six years ago but has picked up an impressive head of steam this year. The April figures show France has now built its biggest lead over Germany in at least three years.
Within the survey, manufacturing activity climbed 2 points while overall business optimism hit multi-year highs.
“The French private sector remains resilient to political uncertainty around the upcoming presidential election” said Alex Gill at Markit.
The country’s four main presidential hopefuls all offer radically different visions for the economy. Marine Le Pen, the far-right leader, is backing a eurozone exit and has promised to revive jobs in the country’s industrial heartlands with a blend of populism and massive fiscal spending.
Far-left candidate Jean-Luc Mélenchon, whose popularity has surprised analysts this month, is proposing a near €300bn investment and spending package to jolt growth and create jobs. The former Socialist also wants to lower France’s retirement age and cap salaries.
Meanwhile, centrist Emmanuel Macron and right-wing François Fillon support reigning in the country’s public finances through deficit and debt reduction, coupled with tax cuts. All four candidates are polling within a 19-24 per cent range according to the FT’s poll of polls.
France’s first set of official first quarter GDP figures will be released next week.
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