Published by Global Banking & Finance Review®
Posted on February 5, 2025
1 min readLast updated: January 26, 2026
Add as preferred source on Google
Germany's service sector activity rose to a six-month high in January 2025, with the PMI reaching 52.5. Despite optimism, challenges like weak demand persist.
BERLIN (Reuters) - Germany's service sector began 2025 on a positive note, with business activity growth reaching a six-month high and employment seeing a modest rise, a survey showed on Wednesday.
The HCOB final services Purchasing Managers' Index rose to 52.5 in January from 51.2 in December, in line with the preliminary reading.
"This is an encouraging start to the year. Growth seems to have a chance again," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, noting that the composite PMI had climbed above the 50-point mark for the first time in seven months.
PMI readings above 50.0 signal growth in activity, while those below indicate contraction.
The survey highlighted optimism among firms, driven by hopes of a post-election economic boost and lower interest rates.
Despite the positive start, underlying demand remained weak, the survey showed. Client uncertainty and a lack of public sector projects were cited as factors dampening demand, alongside a notable drop in new business from abroad.
Looking ahead, service providers expressed the highest level of confidence in eight months, anticipating economic recovery and new market opportunities.
(Reporting by Maria Martinez; Editing by Hugh Lawson)
The main topic is the growth in Germany's service sector activity as indicated by the PMI index for January 2025.
A PMI above 50 indicates growth in business activity within the sector.
The sector faces challenges such as weak demand, client uncertainty, and a drop in new business from abroad.
Explore more articles in the Finance category
