German manufacturing PMI sank to 43.0 in July.Economists surveyed by Bloomberg were expecting a reading of 43.3, down from 45.0 in June.
A reading below 50 signals contraction in the industry.
Key points from Markit:
- Production drops for fourth month running in July
- Job shedding fastest for two-and-a-half years
- Fastest decline in input costs since August 2009
From Markit economist Tim Moore:
The German manufacturing PMI number slipped to bronze position in the ranking of the ‘big four’ eurozone economies during July, its lowest position for three years and indicative of a sharp deterioration in business conditions over the month. Manufacturers linked the latest setback to shrinking export sales and a general shortage of new work to replace completed projects. Output dropped at the steepest pace for over three years and job shedding was the most marked since the start of 2010.
“A further sign of heightened concerns about the outlook was the rapid drop in input purchases, with the pace of decline the steepest ever recorded by the survey outside of the 2008/09 recession period.”
Germany is Europe’s largest economy, and it’s one of the more financially sound.
However, lately, its economy has been showing cracks.