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French Service Sector Contracts More Than Estimated In April

5/4/2012 4:09 AM ET

The French service sector contracted in April largely due to a deceleration in incoming new business, final data from Markit Economics showed Friday.

The final business activity index dropped to 45.2, down from the flash estimate of 46.4. It stayed below March's 50.1.

Incoming new business decreased at the steepest rate for three years, leading to a substantial reduction in activity. Consequently, backlogs of work dipped sharply.

Lower workloads did not result in job shedding, however, as employment remained stable on the month. Meanwhile, optimism regarding future activity weakened to the lowest since January.

Input prices remained solid in April. However, prices charged by service providers fell slightly.

The composite output index dropped to 45.9 in April from 48.7 in March. That was the lowest since October 2011 and weaker than the earlier flash reading of 46.8.

by RTT Staff Writer

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