Investing.com - Manufacturing activity in Germany slowed to the lowest level in two months in February, while the services sector also hit a two-month low, preliminary data showed on Wednesday.
In a report, market research group Markit said that its preliminary German manufacturing purchasing managers’ index declined by 0.9 points to a seasonally adjusted 50.1 in February from a reading of 51.0 in January.
Analysts had expected the index to rise by 0.5 points to 51.5 in February.
A reading above 50.0 on the index indicates industry expansion, below indicates contraction.
The latest reading signaled a solid pace of expansion, albeit less marked than the seven-month high reached in January.
Meanwhile, the report showed that service sector activity in Germany slumped to a two-month low in February.
The preliminary services purchasing managers’ index declined by 1.1 points to a seasonally adjusted 52.6 from 53.7 in January. Analysts had expected the index to ease up 0.1 points to 53.8.
Commenting on the report, Tim Moore, Senior Economist at Markit said, “The latest survey therefore suggests that we’re on track to see a modest rebound in German GDP following the slight contraction during Q4 2011.”
“However, manufacturers are still suffering from shrinking underlying demand and in turn relying on backlogs of work to boost production. The failure of new orders to gain traction mainly stems from weak external demand, as exports have now fallen for eight months in a row,” he added.
Following the release of the data, the euro turned lower against the U.S. dollar, with EUR/USD easing down 0.04% to trade at 1.3229.
Meanwhile, European stock markets erased gains, with the EURO STOXX 50 declining 0.35%, France’s CAC 40 shedding 0.05%, London’s FTSE 100 retreating 0.1%, while Germany's DAX dropped 0.3%.
In a report, market research group Markit said that its preliminary German manufacturing purchasing managers’ index declined by 0.9 points to a seasonally adjusted 50.1 in February from a reading of 51.0 in January.
Analysts had expected the index to rise by 0.5 points to 51.5 in February.
A reading above 50.0 on the index indicates industry expansion, below indicates contraction.
The latest reading signaled a solid pace of expansion, albeit less marked than the seven-month high reached in January.
Meanwhile, the report showed that service sector activity in Germany slumped to a two-month low in February.
The preliminary services purchasing managers’ index declined by 1.1 points to a seasonally adjusted 52.6 from 53.7 in January. Analysts had expected the index to ease up 0.1 points to 53.8.
Commenting on the report, Tim Moore, Senior Economist at Markit said, “The latest survey therefore suggests that we’re on track to see a modest rebound in German GDP following the slight contraction during Q4 2011.”
“However, manufacturers are still suffering from shrinking underlying demand and in turn relying on backlogs of work to boost production. The failure of new orders to gain traction mainly stems from weak external demand, as exports have now fallen for eight months in a row,” he added.
Following the release of the data, the euro turned lower against the U.S. dollar, with EUR/USD easing down 0.04% to trade at 1.3229.
Meanwhile, European stock markets erased gains, with the EURO STOXX 50 declining 0.35%, France’s CAC 40 shedding 0.05%, London’s FTSE 100 retreating 0.1%, while Germany's DAX dropped 0.3%.