Germany's private sector returned to growth in January 2025, with the HCOB Composite PMI revised up to 50.5 from a preliminary 50.1 and December's 48.0.
Germany PMI up, signaling expansion
This marks the first expansion in seven months, fueled by growth in services (PMI at 52.5) and a slower contraction in manufacturing (PMI at 45). The expansion was primarily driven by businesses working through backlogs, as new orders continued to decline, though at a slower rate. Job losses eased, with the service sector even adding jobs. Business confidence improved in both sectors.
Rising costs force price hikes in Germany
However, inflationary pressures intensified, with input costs rising at the sharpest rate in nearly two years, driven by higher service sector expenses and stabilizing manufacturing input costs. Consequently, businesses increased their selling prices at the fastest pace since February 2024.
