Finance
German services activity returns to contraction in August, PMI shows
Published by Global Banking & Finance Review®
Posted on September 3, 2025
2 min readLast updated: January 22, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on September 3, 2025
2 min readLast updated: January 22, 2026
In August, the German services sector saw a slight contraction with PMI at 49.3, indicating reduced activity and new business challenges.
BERLIN (Reuters) -German services sector activity contracted slightly in August after a marginal expansion in July, as new business shrank again, a survey showed on Wednesday.
The HCOB Germany Services PMI fell to 49.3 in August from 50.6 in July. Any reading below 50 signals a drop in overall activity, while above that mark indicates growth.
August's decline was attributed to the fall in new work inflows and stalled hiring, with demand fragility and uncertainty among customers also cited as contributing factors.
"Compared to the previous month, price hikes were noticeably stronger," said Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank AG.
"The relatively solid pricing power suggests that companies aren't yet in a critical situation," he added.
Despite the dip in activity, business expectations remained stable, with firms optimistic about their future growth prospects. Around 30% of surveyed firms anticipated increased activity over the next year, driven by factors such as new products and investment.
However, the survey highlighted a drop in new export business, partly due to weaker demand from European markets, while employment levels stagnated after a seven-month streak of job creation.
The composite PMI, which covers both services and manufacturing, remained stable at 50.5 in August, suggesting marginal growth in German business activity.
(Reporting by Rachel More; Editing by Hugh Lawson)
The HCOB Germany Services PMI fell to 49.3 in August from 50.6 in July.
The contraction was attributed to a fall in new work inflows, stalled hiring, and demand fragility among customers.
Despite the dip in activity, business expectations remained stable, with around 30% of firms anticipating increased activity in the future.
The survey highlighted a drop in new export business, partly due to weaker demand from European markets.
A PMI reading below 50 signals a drop in overall activity, while a reading above that mark indicates growth.
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