German Private Sector Downturn Deepens

(RTTNews) - Germany's private sector contracted at the fastest pace in a year-and-a-half in June, flash data from S&P Global showed on Tuesday.

The flash composite output index registered 48.0 in June, down from 48.8 in May. The score was forecast to rise to 49.9. The reading was the lowest recorded since December 2024.

The latest decrease was centered on the service sector, which recorded its worst performance in over three-and-a-half years in June. The services PMI declined unexpectedly to 46.8 from 48.1 in the prior month. The expected reading was 49.0.

At the same time, the factory PMI fell marginally to the neutral mark of 50.0 in June from 50.1 in the previous month. The score was seen at 50.3.

Inflows of new business decreased for the fourth straight month and marked the biggest drop since late 2024. Employment continued to decline in June but the pace of decrease was unchanged from May.

Regarding price pressures, the survey showed that there was a noticeable slowdown in input cost inflation and it eased from a 42-month high in May. At the same time, output prices grew at the slowest rate in three months in June.

Further, there was a slight weakening of overall business expectations towards output in the next twelve months, the survey showed.