Germany July final services PMI 49.8 vs 49.6 prelim
- Prior 48.6
- Final Composite PMI 51.3 vs 51.2 prelim
- Prior 49.5
Key findings:
- Service sector moves closer to stabilisation as demand picks up
- Business activity falls only fractionally in July
- New business rises for first time in five months, albeit marginally
- Rates of input cost and output price inflation rebound
Comment:
Phil Smith, Economics Associate Director at S&P Global Market Intelligence:
“Business conditions have steadied across the service sector, with not only business activity coming close to stabilising in July, but employment too.
“The latest survey results showed the first signs of a pick-up in demand since the outbreak of the Middle East war, with new work rising slightly in July following four months of weakening demand. Confidence is slowly starting to return, as indicated by a further improvement in firms’ growth expectations in the coming year.
“The renewed inflationary pressures in the services sector at the start of the third quarter didn’t come as a surprise given the expiry of the temporary fuel tax cut at the end of June. Where inflation is headed in the coming months, however, is frankly anyone’s guess, with the rapidly changing situation in the Middle East leading to considerable volatility in global energy prices and supply chain uncertainties.
“Based on its recent direction of travel, the service sector looked well positioned to return to growth in the third quarter, but the recent flare-ups of hostilities in the Middle East show there are still substantial risks to the outlook."
This article was written by Giuseppe Dellamotta at investinglive.com.