German manufacturing activity grew at the weakest pace in 74-months in February, the latest manufacturing activity report from IHS/Markit research showed this Thursday.
The German manufacturing purchasing managers index (PMI) slipped further into contraction territory and arrived at 47.6 versus 49.7 expected and 49.7 previous. Meanwhile, while services PMI climbed to a five-month high level of 55.1 as against previous month’s reading of 53.0 and 52.9 anticipated.
The IHS Markit Flash Germany Composite Output Index also climbed to 4-month tops of 52.7 in February, up from 52.1 in January.
Key comments from Phil Smith, Principal Economist at IHS Markit:
“The manufacturing PMI fell further into contractionary territory in February to its lowest in over six years, with sustained robust job creation at factories the only positive takeaway. The strength in employment is perhaps surprising given the order book situation and lack of pressures on capacity, but goods producers are seemingly looking through the current soft patch in demand.”
“In terms of the factors behind the slowdown in manufacturing order books, many of the usual suspects – the uncertainty relating to US-China trade tensions and weakness in the autos industry – were highlighted, although there were also reports of growing competitive pressures within Europe.”
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