DE: PMI Composite


Wed Feb 04 02:55:00 CST 2015

Consensus Actual Previous
Composite - Level 52.6 53.5 52.0
Services - Level 52.7 54.0 52.1

Highlights
Services had a better month than originally thought in January. The sector's flash PMI was revised up fully 1.3 points to 54.0 in the final data, a 3-month high and nearly 2 points above its final December reading. In turn, the final composite output index weighed in at 53.5, some 0.9 points above its provisional print and 1.5 points stronger than in year-end.

January's upswing reflected a return to positive orders growth which had turned slightly negative for the first time in seventeen months at the end of 2014. Nonetheless, the pick-up here was relatively modest and below the levels seen in the middle of last year. Nonetheless, employment expansion was strong with job creation accelerating to its fastest pace since last July. This will have helped to facilitate a slight depletion in backlogs. Business optimism was bullish, reaching a 45-month peak on the back of hopes for a stronger economy.

Input costs rose again but the rate of inflation was unchanged from December's marginal pace as the boost from the introduction of a new minimum wage was offset by the ongoing fall in fuel charges. Meantime, competitiveness pressures showed no signs of easing and service providers reduced prices after a slight increase last time.

The revisions to the flash survey data paint a rather more upbeat picture of private sector activity at the start of the year. The buoyancy of business optimism is particularly promising although this could yet prove overly so given what remains at best, only a moderate growth rate in orders. In any event, for now CPI inflation looks set to stay under downside pressure.

Definition
The Germany Composite PMI is based on original survey data collected from a representative panel of 1,000 companies based in the German manufacturing and service sectors. The final Germany Composite PMI follows on from the flash estimate which is released a week earlier and is typically based on at least 75 percent of total PMI survey responses each month.

The Germany Services PMI is produced by Markit and is based on original survey data collected from a representative panel of over 500 companies based in the German service sector. The final Germany Services PMI follows on from the flash estimate which is released a week earlier and is typically based on at least 75 percent of total PMI survey responses each month.


Description
The Purchasing Managers Index (PMI) survey has developed an outstanding reputation for providing the most up-to-date possible indication of what is really happening in the private sector economy by tracking variables such as sales, employment, inventories and prices. The indices are widely used by businesses, governments and economic analysts in financial institutions to help better understand business conditions and guide corporate and investment strategy. In particular, central banks in many countries (including the European Central Bank) use the data to help make interest rate decisions. PMI surveys are the first indicators of economic conditions published each month and are therefore available well ahead of comparable data produced by government bodies.