Brandenburg Gate in Berlin, Germany

Germany PMI October 2018

Germany: Composite PMI falls to multi-year low in October

The composite Purchasing Managers’ Index (PMI) dropped from a revised 55.0 in September to 52.7 in October, marking the softest pace of growth in private sector business activity in nearly three-and-a-half years and below the long-term average of 53.4. However, the index remained above the 50-point mark that separates expansion from contraction in the private sector.

The moderation came on the back of softening momentum in both the services and the manufacturing sectors, with the latter expanding at the slowest pace in over two years. This was partly due to weakening foreign and domestic demand dynamics. New export orders eased for the second consecutive month in the manufacturing sector, and manufacturers’ total order books contracted for the first time in nearly four years. Moreover, new orders growth in the services sector slowed. However, despite softening demand levels, employment growth remained robust in both sectors.

Inflationary pressures remained elevated on the back of a marked uptick in input costs—due to higher oil prices—which led firms to hike output prices to protect their profit margins. Output price inflation in the services sector was the strongest in the survey’s history.

Looking ahead, business confidence towards the year ahead reached a four-year low as uncertainty over the trade war, tariffs and Brexit weighed on sentiment, with the mood among manufactures turning pessimistic for the first time in several years.

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest