German Private Sector Downturn Eases On Cooling Inflation, Lower Recession Fears
2023年1月24日 - 06:12PM
Germany's private sector downturn softened to a stable footing
at the start of the year amid a moderation in price pressures along
with a renewed positive outlook on reducing recession risks and
ongoing strength in the job market, flash survey data from S&P
Global showed on Tuesday.
The flash composite output index rose to a seven-month high of
49.7 in January from 49.0 in December. The index was forecast to
rise slightly to 49.6.
However, any reading below 50 indicates contraction in the
The improvement in the composite index mainly relied on the
service sector, which returned to growth for the first time in
seven months. Meanwhile, the factory activity continued its
declining trend in January.
The services Purchasing Managers' Index, or PMI, climbed to a
7-month high of 50.4 in January from 49.2 in the prior month. The
score was forecast to increase to 49.6.
The manufacturing PMI dropped to a two-month low of 47.0 from
47.1 in December. The expected score was 47.9.
Read more: German Economy Roughly Stagnated In Q4:
Bundesbank The German private sector still remained in contraction
territory on account of lower demand due to multiple headwinds like
steep inflation, tightening financial conditions, and investment
reticence, as well as investment reticence in manufacturing.
However, the overall fall in new orders was the weakest in seven
In addition, the easing of supply-chain bottlenecks amid falling
global demand contributed to a further cooling of inflationary
pressures in January.
The labor market also showed strong resilience, as employment
growth picked up pace to a 6-month high.
Business confidence remained on an upward trajectory in January
amid easing recession risks.
"Business confidence continues to recover from last October's
low point, but it nevertheless remains subdued compared to the
situation prior to Russia's invasion of Ukraine, particularly in
manufacturing where we're still seeing notable weakness in new
orders and perhaps the beginning of a period of stock depletion as
supply-chain concerns fade," Phil Smith, a senior economist at
S&P Global, said.
Read more: German Economic Sentiment Strengthens On
Favourable Energy Markets
Elsewhere on Tuesday, survey results from the market research
group GfK showed that Germany's consumer confidence is set to
improve for the fourth month in a row in February amid the
sustained recovery in both economic and income expectations as
energy prices rose less sharply and the government took
The forward-looking consumer confidence index climbed to -33.9
from -37.6 in January, which was revised from -37.8. However,
economists had expected a higher reading of -33.
Private consumption will not be able to make any positive
contribution to overall economic development this year and the
propensity to buy continued with its ups and downs as households
were expecting significantly higher amounts for their heating bills
in the coming months, the Nuremberg-based GfK said.
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