German manufacturing PMI beats expectations, suggests accelerated rate of GDP growth in Q4

Preliminary data released by Markit Economics showed on Thursday that growth of Germany’s private sector continued at the robust pace seen in the preceding two months during December. In a report, Markit Economics said that German manufacturing PMI rose to a seasonally adjusted 55.5, from 54.3 in the preceding month, beating economists' expectations for rise to 54.5. It was the highest reading in 35-months.

Flash Germany services PMI Activity Index posted at 53.8 in December compared to 55.1 in November, hitting a 3-month low. The Markit Flash Germany Composite Output index posted 54.8, down only slightly from 55.0 in November and 55.1 in October.

The rate of job creation in Germany’s private sector remained solid with both sectors seeing jobs growth. Pressure on operating capacity remained, backlogs of work rose for the seventh straight month, and at the fastest pace since June. December data signalled mounting cost pressures at German private sector businesses.

“Germany’s manufacturing sector appears to be in particularly good health. December’s flash PMI signalled a strong end to the year for German private sector firms," said Philip Leake, economist at IHS Markit.

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