German manufacturing PMI drops to 21-month low in July
Investing.com
Published Jul 21, 2011 03:42AM ET
In a report, market research group Markit said that its preliminary German manufacturing purchasing managers’ index fell to a seasonally adjusted 52.1 in July, down from 54.6 in June.
Analysts had expected the index to decline to 54.1 in July.
A reading above 50.0 on the index indicates industry expansion, below indicates contraction.
The report showed that service sector activity in Germany slumped to a 17-month low in July.
The preliminary services purchasing managers’ index fell to a seasonally adjusted 52.9 from 56.7 in June. Analysts had expected the index to ease down to 56.1.
Although the latest reading remained above the 50.0, the month-on-month index point fall was the largest since November 2008.
Commenting on the report, Tim Moore, Senior Economist at Markit said, “The overall pace of expansion in July was the slowest since the recovery began two years ago, reflecting much weaker growth in both manufacturing and services.”
“Hopes of a near-term rebound are hanging by a thread, as export sales fell at the fastest pace since June 2009 and the forward-looking new orders to stocks of finished goods ratio continued to take an unsupportive downward course,” he added.
Following the release of the data, the euro was up against the U.S. dollar, with EUR/USD gaining 0.32% to trade at 1.4261.
Meanwhile, European stock markets were mixed after the open. The EURO STOXX 50 climbed 0.15%, France’s CAC 40 dipped 0.25%, the FTSE 100 fell 0.2%, while Germany's DAX edged 0.25% lower.
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