| CATEGORY: INTERNATIONAL ECONOMIC |
Tue 24 Jul 2012
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LONDON (SHARECAST) - The seasonally adjusted Markit Flash Germany Composite Output Index fell for the sixth month running in July, to 47.3 from 48.1 in June.
The index has posted below the 50.0 no-change value in each month since May, and the latest reading signalled the fastest pace of private-sector contraction since June 2009.
Manufacturers suffered a sharper drop in business activity than service providers during July, as well as a greater loss of momentum relative to the situation in June.
Both data points turned out worse than consensus expectations with the manufacturing PMI settling in at 43.3, a 37-month low and below the 45.3 estimate. The services activity index, for its part, registered a 10-month low at 49.7, below the 50 point forecast.
The latest reduction in manufacturing production was the steepest for just over three years, while new orders received in the sector dropped at the fastest pace since April 2009.
“July’s survey highlights that German business conditions are far less healthy than those seen during the first half of 2012, especially across the manufacturing sector where new export orders fell at the fastest pace for over three years,” said Markit senior economist Tim Moore.
“A solid overall drop in output during July represents the worst start to any quarter since Q2 2009. Moreover, an accelerated decline in new work means that the stage could well be set for a steeper drop in GDP than the 0.2% fall recorded at the end of 2011,” he added.
JM
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