- Prior 49.5
- Services PMI 54.5 vs 51.0 expected
- Prior 51.5
- Composite PMI 53.8 vs 51.5 expected
- Prior 52.0
Key Findings:
- Fastest output growth in over two years as new orders and backlogs rise
Comment:
Commenting on the flash PMI data, Dr. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, said:
“This is an unexpectedly good start to the final quarter. Activity in the service sector has increased significantly, and output in the manufacturing sector has risen for the eighth consecutive month. This means that the economy as a whole is also showing accelerated growth.
"It is encouraging to see that new orders in the manufacturing sector have risen again slightly after a dip in the previous month. New business in the service sector has even received a real boost. Basically, these are good conditions for growth in the fourth quarter. However, the fact that the outlook for the future is more cautious than in the previous month, both among service providers and in industry, shows that the economic situation remains fragile.
“The situation in the manufacturing sector remains difficult. Although companies in this sector once again produced more than in the previous month, they are continuing to cut jobs at an accelerated pace. Added to this are the current problems surrounding supply chain issues in connection with semiconductors, which are particularly needed in the automotive sector, but also in mechanical engineering. The accelerated reduction in stocks of inputs and slower supplier delivery times may be linked to these uncertainties.
“The situation in the service sector is brightening. This is evidenced by significantly more business activity than in the previous month and a higher volume of new business. In addition, after two months of staff reductions, companies have stepped up their hiring again. One factor weighing on the sector is that costs have risen at an accelerated pace for the third month in a row.
"Above-average wage increases are likely to continue to have an impact here, as they are enforceable despite the deterioration in the labour market situation in the economy as a whole. At least service providers are in a position to pass on some of the cost increases to their customers, as sales prices have also risen more sharply than in the previous month.”
