Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

German Business Activity Contracts in July - Flash PMIs

Economic Indicators Jul 22, 2022 10:42
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Scott Kanowsky 

Investing.com -- Inflation-driven declines in both domestic and foreign demand caused business activity in Germany to contract for the first time this year in July, according to a closely watched survey of companies on Friday.

S&P Global said its flash German composite purchasing managers index, which is used to measure the health of business activity in the country, sank to 48.0 from 51.3 in June. A reading below 50 suggests contraction.

It is the lowest level in 25 months, and well below expectations of 50.1, as firms reported that soaring inflation ate into their budgets. Performance was also hit by ongoing supply chain disruptions and uncertainty stemming from the war in Ukraine.

Activity in both Germany's manufacturing and services industries declined to 49.2. Economists had expected both sectors to remain in expansion territory, or above the 50-point mark.

Expectations for the future also darkened to levels not seen since the height of first wave of the COVID pandemic, according to S&P Global.

"[G]iven the noticeable falls in new business across both sectors, activity was somewhat prevented from experiencing a sharper fall thanks to the availability of previously secured contracts. With signs that this supportive prop is coming to an end, and warehouse inventories rising at a near-record rate in manufacturing, the outlook for output is turning increasingly negative,” said Paul Smith, economics director at S&P Global Market Intelligence.

Meanwhile, activity in France's key services sector slowed to a 15-month low in July due to surging consumer prices that weighed on the inflow of new business.

The reading from S&P Global fell to 52.1 during the month, down from 53.9 in the previous period. Analysts had anticipated the figure to come in at 52.7.

"The growth trend in the service sector [...] worsened further, and momentum is clearly to the downside here," said S&P Global senior economist Joe Hayes.

German Business Activity Contracts in July - Flash PMIs
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email