German factory activity contracts more than expected in October

By Tuba Sahin

ANKARA (AA) – Germany’s factory activity contracted more than expected in October due to faster declines in both output and new orders, according to data released by S&P Global on Wednesday.

Germany’s manufacturing purchasing managers’ index (PMI) dropped from 47.8 in September to 45.1 in October, the lowest level since May 2020, the US-based financial services company said.

For the fourth month in a row, the figure was below the threshold that indicates contracting activity.

Manufacturers saw a deepening decline in new orders due to growing concerns about the economic outlook and high energy costs, read an S&P Global report.

“There was further downward pressure on output levels at the start of the fourth quarter, with firms noting the influence of high energy costs and a deepening downturn in demand,” said Phil Smith, economics associate director at S&P Global Market Intelligence.

On the positive side, the rate of employment growth picked up slightly from September’s 19-month low.

“Manufacturers are gravely concerned about the outlook for the next 12 months, with expectations having fallen to their lowest since the initial COVID wave,” Smith added.