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Weak demand hits manufacturing activity in Germany

German manufacturing activity has slowed in November as the Markit flash Germany manufacturing purchasing managers’ index (PMI) revealed a reading of 50.0, compared to 51.4 in October.

German manufacturers reported the steepest drop in new work in nearly two years in November, citing economic uncertainty and weaker demand from both domestic and foreign markets.

The latest flash data for Germany also showed a slowing in private sector output growth as the Markit flash Germany composite output index fell from 53.9 in October to 52.1.

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Service sector business activity increased at the weakest rate in 16 months, according to Markit Economics.

Oliver Kolodseike, economist at Markit and author of the flash Germany PMI, said: “The combination of weak output growth, ongoing spare capacity and a lack of new order wins (despite a further reduction in charges) paints a worrying picture of the underlying health of the German economy.”

Meanwhile, France’s private sector economy continued to contract in November, with the Markit flash France composite output index up slightly at 48.4, from 48.2 in October.

But manufacturing PMI dropped to 47.6 in the month, down from 48.5 in October and a three-month low.

According to Market, while service providers recorded the slowest fall in activity of the current three-month period of decline, manufacturers indicated the sharpest reduction in output since August.

Jack Kennedy, senior economist at Markit, added: “November’s Flash PMI data point to another weak performance by France’s private sector economy, with output showing a further modest fall.”