2025-11-03 08:55:00
- Prior was 49.5
- Full report here
Key findings:
- Output prices rise for first time in six months
Comment:
Commenting on the PMI data, Nils Müller Junior Economist at Hamburg Commercial Bank, said:
“Germany’s manufacturing sector continued to tread water in October, with the headline PMI inching up to 49.6 from 49.5 in
September, remaining just below the crucial 50.0 threshold that separates expansion from contraction. While output rose for
the eighth consecutive month, this latest upturn was driven primarily by the investment goods segment, suggesting that the
recovery remains fragile.
“A lack of demand and persistent uncertainty weighed on the broader sector. New orders returned to marginal growth, driven
by demand for investment goods, yet export sales continued to decline, particularly to Asia and the US, according to
surveyed firms. Manufacturers cited customer caution, US tariffs, and a sluggish construction sector as factors weighing on
demand. Employment fell again, extending the sequence of job shedding to 28 months, as firms responded to subdued
capacity pressures and maintained hiring freezes.
“Purchasing activity was scaled back again, and inventories of both inputs and finished goods were reduced at a faster pace.
Interestingly, supplier delivery times lengthened for the second month in a row, hinting at emerging supply chain frictions.
Purchasing costs continued to fall in October, extending the current deflationary trend that began in early 2023. Meanwhile,
output prices rose modestly – only the second increase in over two years – with the uptick driven primarily by the consumer
goods segment.
“Overall, the outlook for Germany’s industrial sector remains fragile. Manufacturers’ expectations for future output
deteriorated further, falling to the lowest level since December last year. While some firms remain hopeful about improving
economic conditions and new product launches, concerns over falling backlogs and elevated costs are weighing on
sentiment.”
