German composite PMI hits 70-month high in March, signals strong Q1 growth

Survey results from IHS Markit showed Friday that German March flash PMI results suggests that growth in Europe's largest economy will accelerate in the first quarter. Markit's flash composite Purchasing Managers' Index (PMI) rose to 57.0 from 56.1 in February, overshot the consensus forecast in a Reuters poll.

The composite output index rose for the second straight month in March and was the highest score since May 2011. The services Purchasing Managers' Index rose to 55.6 in March from 54.4 in February, beating forecasts for a score of 54.5. The factory PMI climbed unexpectedly to 58.3 from 56.8 in February. The score was forecast to fall to 56.5.

Inflationary pressures continued to build, with input and output prices both rising at the fastest rates in around six years. Companies responded to the rising demand by speeding up hiring. A near-record rate of employment growth was seen with the rate of job creation almost matching a record set six years ago.

Forward-looking data on output expectations strengthened further in March, with the Future Output Index hitting a new high since its inception in July 2012.