Germany’s economic recovery from the COVID-19 pandemic slowed down in September as activity in both the manufacturing and services sectors dragged on amid supply bottlenecks.
- IHS Markit’s flash Purchasing Mangers’ Index (PMI) indicated growth in the manufacturing sector cooled down to an eight-month low reading of 58.5 from 62.6 in August. The services PMI index dipped to a 4-month low of 56.0 from 60.8 in August.
- The flash composite PMI, which tracks the manufacturing and services sectors that together account for over two-thirds of the German economy, dropped to a seven-month low of 55.3 from 60.0 in August.
- IHS Markit analyst Phil Smith stated that the survey data implied that business activity was starting to level off after recovering sharply over the summer period.
- Smith further stated that despite a slowdown in September, the rate of economic growth in the third quarter is poised to top the 1.6% expansion recorded in the three months to June.
Growth expectations were curbed by supply chain concerns and risks posed to demand by rising prices. A scarcity of intermediate goods also contributed to slowed production in the industrial sector.
DAX up +0.84%, EUR USD up +0.26%Source: IHS Markit