German manufacturing decline eases in August

Thursday, 22. August 2019 09:30

Purchasing managers from Germany's private sector reported an expansion in activity for this month where the rise in the nonmanufacturing segment narrowed to a seven-month low, IHS Markit said on Thursday and added it learned from producers that their output dropped but less than in July. The composite index advanced by half a point to 51.4, compared to the neutral 50-point mark.

The services item slipped by just 0.1 points to 54.4. The manufacturing headline came in 0.4 points stronger at 43.6 in its eighth straight print under 50 and output advanced 1.6 points to a still fairly weak 45.8.

"Although improving slightly, the survey’s output data haven’t changed enough to dispel the threat of another slight contraction in GDP in the third quarter, especially given the deterioration in the forward-looking indicators... Cracks are starting to appear elsewhere in the services data, with inflows of new work barely rising in August and business confidence at its lowest for almost five years" together with a plunge in the manufacturing outlook to a record low and flat hiring, principal economist Phil Smith said.

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