Germany composite PMI touches 3-month high on solid rise in private sector output

Germany’s activity sector output rebounded during the month of October, following solid co-operation from private sector output, with the country’s composite Purchasing Managers’ Index (PMI) touching a 3-month high during the period.

Flash Germany PMI Composite Output Index rose to 55.1 in October, from 52.8 in September. Also, lash flash services PMI Activity Index jumped to 54.1 this month, from 50.9 in September, while the flash index for the country’s manufacturing sector rose to 55.1 in October, a33-month high, from 54.3 in the previous month; flash Germany manufacturing Output Index modestly rose to 56.9, compared to 56.4 in September, data released by HIS Markit showed Monday.

The increase in overall activity was supported by the sharpest rise in new business this year so far. Demand for German services picked up, having increased only marginally in the prior month. Meanwhile, new orders placed with manufacturers continued to rise at a solid pace. Part of the increase was attributed to stronger demand from foreign clients, with Asia and the US mentioned specifically as sources of export growth.

However, a combination of higher raw material prices (especially for oil and steel) and increased staff  costs exerted upward pressure on overall input prices. The rate of inflation reached a 17- month high in October.

Meanwhile, business confidence among service providers picked up slightly, with some panelists commenting that a positive economic environment is likely to boost activity growth over the next 12 months.