Germany: Composite PMI rises to nearly six-year high in March
March 24, 2017
The Markit Flash Composite Purchasing Managers’ Index (PMI) rose to 57.0 in March, up from 56.1 in February and the highest mark in almost six years. The PMI—the result of a survey of over 1,000 manufacturing and service businesses based in Germany—has remained above 50, the threshold indicating expansion, since April 2013.
The surge was driven by stronger PMI readings for services and manufacturing, the latter coming in at an almost six-year high. In March, output and new orders continued to grow. New export orders grew at the fastest pace since April 2011, while backlogs of work increased for a tenth consecutive month. As a result, German companies continued to hire new workers at a fast rate. Input prices increased for the seventh month running, principally as a result of higher commodity prices and a strong dollar. Output prices also increased, reaching an almost six-year high as producers passed on higher input prices to customers.
IHS Markit commented that, “the March flash PMI results rounded off a strong first quarter for the Germany economy, which enters the spring growing at the fastest rate in nearly six years […].The PMI data strongly suggest that economic growth will accelerate in the first quarter.”
Author: Christopher Mc Innes, Economist