September 23, 2024 07:39 GMT
GERMAN DATA: Weakest Manufacturing Reading In 12 Months - Sep Flash PMI
GERMAN DATA
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The German flash manufacturing PMI printed its lowest since September 2023 at 40.3 (vs 42.3 cons, 42.4 prior). Services remained in expansionary territory at 50.6, but consensus had expected a stronger 51.0 print (vs 51.2 prior).
Like the French flash reading, the report noted a softening of inflationary pressures. Combined with the weak activity outlook, this may tempt some dovish ECB policymakers into favouring a faster-than-quarterly pace of rate cuts.
Key notes from the release:
- “The drag from the manufacturing sector increased as goods production posted its steepest rate of contraction for 12 months (index at 40.5). At the same time, support to the economy from growth in the service sector continued to wane”
- “A renewed decline in new work received by services firms coincided with a deepening downturn in manufacturing new orders. New export business also fell on a broad-based basis and at a quicker rate”.
- “Latest data showed a fourth straight month of job losses”…"Pessimism towards the outlook reflected a range of factors that included recession concerns, market uncertainty and weakness in the automotive and construction sectors”.
- “Latest data showed a notable softening of inflationary pressures across the eurozone’s largest economy, with price increases in the services sector easing and discounting becoming more prevalent across manufacturing”.
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