- Final Manufacturing PMI 43.0 vs. 43.2 expected and 43.0 prior.
Key findings:
- HCOB Germany Manufacturing PMI at 43.0 (Oct: 43.0). Unchanged.
- HCOB Germany Manufacturing PMI Output Index at 43.1 (Oct: 42.8). 5-month high.
- Employment, purchasing activity and stocks all fall at faster rates
Comment:
Commenting on the PMI data, Dr. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, said:
"The situation for German industry is looking pretty grim. People are feeling the pinch as reports of companies in the manufacturing sector planning massive job cuts are coming in almost daily. The PMI Employment Index backs this up, showing a trend of accelerating staff reductions since mid-2023. So far, this has only slightly impacted the unemployment rate, but it makes it even more urgent for the new federal government to take action and boost Germany’s competitiveness.
New orders aren’t dropping as fast as they were in recent months, but that's little consolation. When we look at foreign orders alone, the situation has actually got worse. The slight speed-up in delivery times also points to weakening demand. Companies are more confident about their future than they have been in recent months. This could be because of the coalition collapse and the hope that the new government will finally bring about a real economic turnaround. This would involve things like lower energy prices and a reform of the debt brake.
However, confidence is still very low compared to historical standards. The capital goods sector is getting hit particularly hard right now, mainly due to geopolitical uncertainty according to some companies. The PMI indicates that the recession is deepening in this sector, while the downturn in the intermediate goods sector has slowed down a bit for the second month in a row. Overall, it looks like the recession in the manufacturing industry will drag on into the new year.”
