German factories humming at record paceBusiness | 24 Mar 2021 5:47 pm
German factory activity rose to a record high in March and the services sector expanded after five successive months of contractions, surveys showed on Wednesday, suggesting Europe’s largest economy was shrugging off pandemic lockdowns, Reuters reports.
IHS Markit’s flash Purchasing Managers’ Index (PMI) of activity in the manufacturing sector shot up to 66.6, the highest reading since the survey started in April 1996. That compared with 60.7 in February and beat a Reuters poll forecast for a reading of 60.8.
The surveys were conducted before Chancellor Angela Merkel’s government and leaders of Germany’s 16 states decided this week to reimpose strict measures shutting down most businesses until April 18 to try to break a third wave of the coronavirus disease.
The data also pointed to a revival in the services sector, which had suffered under lockdown measures imposed in November and which were eased early this month.
The flash PMI for the services sector rose to a seven-month high of 50.8, up from 45.7 in February.
As a result, the preliminary composite PMI, which tracks the manufacturing and services sectors that together account for more than two-thirds of the German economy, rose to a 37-month high of 56.8 from 51.1 the previous month.
“The flash PMI pointed to a notable upturn in German business activity in March, with the data therefore hinting at the prospect of a better-than-expected economic performance in the first quarter,” said Phil Smith, associate director at survey compiler IHS Markit.