Financial News: German Private Sector Continues To Shrink

German Private Sector Continues To Shrink

11/22/2024 - 07:21:00 (RTTNews)

(RTTNews) - Germany's private sector continued to contract in November as sustained weakness in manufacturing output was compounded by the first fall in services activity for nine months, flash Purchasing Managers' survey compiled by S&P Global showed Friday.

The HCOB composite output index dropped to 47.3 in November from 48.6 in the previous month. The score signaled acceleration in the rate of decline in activity to the quickest since February.

Services business activity fell into contraction for the first time in nine months in November. The services PMI registered 49.4, down from 51.6 in the previous month. The expected score was 51.8.

Meanwhile, the manufacturing PMI advanced to a four-month high of 43.2 from 43.0 in the previous month. The reading was slightly above forecast of 43.1.

"The political uncertainty, which has increased since Donald Trump's election as US president and the announcement of snap elections in Germany on February 23, isn't helping," Hamburg Commercial Bank Chief Economist Cyrus de la Rubia said.

"However, the modest increase in the future output index might reflect some hope that the next German government will manage to turn the economy around with bold measures, for example by reforming the debt break," de la Rubia added.

The survey showed that weaker demand for goods and services led to further job losses during the year's penultimate month. Further, the rates of input cost and output price inflation climbed to the highest for three months, reflecting stronger price pressures in the service sector.

Meanwhile, business expectations edged up from September's recent low to the highest for three months on hopes of a boost to the economy following elections next year.

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