PARIS (Reuters – French business activity grew at a slower rate in December than last month. An initial estimation in a monthly survey by purchasing managers revealed this trend on Thursday. This is partly because of the Omicron COVID-19 variation.

IHS Markit, a data compiler, stated that the flash composite PMI Index for December (which includes both manufacturing and services sectors) stood at 55.6 points.

Although readings over 50 point indicate positive business outlooks, this print was a little lower than the November 56.1, but still better than the consensus prediction of 55.0 points in a Reuters poll.

Joe Hayes from IHS said, “Another wave of COVID-19-related infections and the appearance of Omicron variants reportedly weighed upon the upturn.”

However, the November reading of growth in France’s most important services sector fell to 57.1 points (from 57.4 in November), but this was still higher than the forecast at 56.0 points.

Flash PMI in the manufacturing sector fell to 54.9 points in December, compared with 55.9 in November. Analysts had expected 55.5 points.

According to IHS, overseas demand has fallen at an unprecedented pace since January.

Hayes stated that service providers suffered a drop in foreign clients due to the Omicron variation’s impact on tourism. He also said that there were still shortages of components and raw materials for the manufacturing industry.

Survey respondents often cited delayed delivery of inputs, and production schedules that were not on time.