world-economy

France's Business Activity Contracts at Steepest Rate Since 2020

French business activity contracted at its fastest pace since late 2020, driven by surging energy costs that have squeezed both consumer spending and corporate operations. The contraction aligns with a broader slowdown across the eurozone, where business activity fell at the quickest rate in two and a half years as geopolitical tensions pushed energy prices higher. The weakness in Europe mirrors inflationary pressures rippling through the United States. U.S. consumer inflation accelerated to 3.8% year-over-year in April — the fastest pace since 2023 — driven by climbing gasoline and food prices. U.S. wholesale inflation similarly accelerated in April to its fastest pace since 2022 on energy-driven increases. These increases are pushing up freight transportation costs. The combination of elevated energy prices and slowing demand is creating headwinds for logistics operators across both markets.