Germany manufacturing nearly stalls in August – survey

01 September 2011 20:04  [Source: ICIS news]

LONDON (ICIS)--Germany’s manufacturing sector “came close to stagnation” in August as exports markets weakened, a research group said on Thursday.

Markit Economics, citing its latest purchasing manager index (PMI) data for Germany, said production growth in Europe’s largest economy hit a 25-month low in August.

Markit’s PMI for Germany recorded its fourth consecutive monthly decline in August, falling to 50.9, after an adjusted 52.0 in July. The index is based on responses from more than 500 Germany-based manufacturing companies.

The group said that August saw a downturn in German sales to export markets, as well as a further reduction in new business from abroad.

“Slower manufacturing growth mainly reflected the sharpest fall in new export orders since mid-2009,” said Markit senior economist Tim Moore.

“Heightened uncertainty about the global economic outlook and the escalating euro area debt crisis were cited as the main reasons why export clients put the brakes on spending in August,” Moore said in commenting on the August data.

Meanwhile, stocks of finished goods at manufacturing firms accumulated at the steepest pace since the PMI survey began in April 1996, suggesting that sales were much weaker than expected in August, the group said.

In related news on Thursday, ICIS reported that US manufacturing growth slowed further in August, with production slipping into contraction for the first time since May 2009.

In Germany’s chemicals industry, producers trade group VCI has forecast 5.0% year-on-year growth in chemical production for 2011.

Read Paul Hodges’ Chemicals and the Economy Blog

By: Stefan Baumgarten
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