German Manufacturing and services sectors remain on solid footing in December

Better than expected PMI data showed that Germany’s private sector remains in an upward trajectory, as activity in manufacturing sector accelerated and services partly recovered in December.

German Manufacturing PMI rose to 58.6 in December – the highest in almost three years- from 57.8 in November, beating expectations for a drop to 56.4.

Services PMI jumped to 47.7 from 46.0 in November and against forecasted drop to 44.0, while Composite PMI, which tracks both sectors that together account for more than two thirds of German economy, rose to 52.5 in December from 51.7 previous month.

Upbeat data showed that the economic recovery picked up and on track to end the fourth quarter on solid footing, although stricter lockdown – as state leaders agreed to shut most stores and schools until at least Jan 10 to contain a second wave of coronavirus – may impact the overall picture, as economists warn of increased risk of another recession.

However, the outlook for Manufacturing and Services sectors for 2021 remains positive on expectations of positive results from Covid-19 vaccine.