By Brian Rohan
BERLIN, Oct 23 (Reuters) - A jump in demand helped German manufacturing activity to expand for the first time in 15 months in October, driving a slight pickup of private sector growth in Europe's largest economy, a survey showed on Friday.
A flash estimate of the Markit composite purchasing managers' index (PMI), which surveys the services and manufacturing sectors, showed growth for the third month running with a reading of 52.6, up from 52.4 in September.
The manufacturing headline index rose to 51.1 from 49.6, lifted by a two-point jump in the sub-component tracking new orders to the sector.
The headline reading beat a consensus forecast for a more modest rise to 50.2 made last week by economists polled by Reuters. A reading of 50 marks the threshold separating growth from contraction.
"It's certainly looking sustainable," said Markit's chief economist Chris Williamson.
"Hopefully there's some underlying momentum which is going to continue to drive expansion of the manufacturing sector ... Export orders are continuing to rise," he added.
Germany pulled out of its sharpest recession since World War Two in the second quarter, and senior policymakers have said growth likely accelerated in the third quarter.
However, government stimulus has played an important hand in this and participants at a meeting of Chancellor Angela Merkel's conservatives this week said she believed the economy was heading for "extremely serious months" in early 2010.
The headline services PMI, tracking businesses ranging from banks to bookshops, fell to 50.9 from 52.1 a month prior but still pointed towards growth. Economists polled had predicted it would rise to 52.5.
The service PMI's business expectations sub-index held above the key 50 mark for a sixth month running although it fell to 57.1 from 61.4 in a sign of a more tempered outlook.
"In previous months there was a widespread feeling that the worst is over, that the coming year was going to show the rate of expansion accelerating," Markit's Williamson said.
"Maybe now we're seeing a few people pulling back ... as stimulus measures fade out -- that may be starting to prey on people's minds now," he added.
Both private sector economists and government experts agree Germany's recovery is likely to be a gradual affair.
On Thursday the Finance Ministry said exports will likely help drive modest growth in the months ahead but that total economic activity was still low and under-utilisation of capacity continued to pose a considerable risk for employment.
(Editing by Toby Chopra)