Germany April final services PMI 46.9 vs 46.9 prelim

Prior 50.9Final Composite PMI 48.4 vs 48.3 prelimPrior 51.9Key findings:Business activity falls at quickest rate for nearly three and-a-half years Confidence slumps amid deepening downturn in demand Output price inflation jumps to 26-month highComment:Phil Smith, Economics Associate Director at S&P Global Market Intelligence: “The chances of the German economy contracting in the second quarter have now risen after a slump in services business activity in April. Unlike the manufacturing sector, which has been supported to an extent by stock building efforts, the services economy has felt the immediate effects of the Middle East war on demand and has seen its steepest drop in activity in nearly three and-a-half years. “Services firms have grown increasingly nervous about the outlook as rising energy prices drive up inflation and squeeze spending power across the economy. “After refraining from stronger price increases in March, which perhaps reflected initial hopes that the conflict and any associated disruption would be short-lived, services firms have started to be more aggressive with their price setting, as shown by a jump in the rate of output charge inflation to its highest in over two years. That said, it’s worth noting that, according to underlying data, a large chunk of the uptick reflected a steep rise in prices charged in the transportation sector, which has been the most exposed to the rise in fuel prices.”
This article was written by Giuseppe Dellamotta at investinglive.com.

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