German activity growth reaches 16-month low
The pace of private sector output growth in Germany is growing at the slowest rate since July last year, while the Markit Flash Germany Composite Output Index declined from 53.9 to 52.1 month on month, Markit revealed.
The data highlight a gradual deterioration of German macroeconomic data, while activity has now risen for 19 months running, the pace of expansion reached a 16 months low. While the latest ifo index had sketched a slightly rosier index in the German service sector, the Markit data recorded that output growth slowed down both for manufacturers and service providers.
Oliver Kolodseike, Economist at Markit and author of the Flash Germany PMI Index said: “The combination of weak output growth, ongoing spare capacity and a lack of new order wins, despite a further reduction in charges, paints a worrying picture of the underlying health of the German economy.
Meanwhile, the labour market still showed resilience to the slowdown, with companies expanding their workforce for the 13th month in a row.
Price levels remained largely stable as the decline in oil and commodity prices was to some extent offset by rising wages ahead of the planned introduction of a national minimum wage.
The Markit index is based on a survey among 1000 German companies in the service and manufacturing sector.