Finance
German manufacturing sector faces sharp decline in new orders, PMI shows
Published by Global Banking and Finance Review
Posted on December 1, 2025
2 min readLast updated: January 20, 2026
Quick Summary
Germany's manufacturing PMI fell to 48.2 in November, with new orders declining sharply. Exports and business confidence remain weak.
German Manufacturing Sector Declines as New Orders Drop
By Maria Martinez
BERLIN, Dec 1 (Reuters) - Germany's manufacturing sector experienced a marked deterioration in business conditions in November, as new orders fell at the fastest rate in ten months, a business survey showed on Monday.
The HCOB Germany Manufacturing PMI compiled by S&P Global fell to 48.2 in November from 49.6 in October, marking a nine-month low and remaining below the 50.0 threshold that indicates contraction.
"Germany's manufacturing sector appears to be unable to cross the threshold to expansion," said Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank AG.
This decline was largely driven by a renewed drop in new orders, with exports suffering their steepest fall this year amid weaker demand from Asia, Europe, and North America.
Despite a ninth consecutive month of increased production volumes, growth slowed to its weakest pace since July.
"Although companies have now been increasing production for nine months in a row, other indicators such as order intakes, employment, and inventories clearly show how bad the situation in industry still is," de la Rubia said.
Employment continued to decline, though at a slightly slower pace than in October, as firms reduced staffing through redundancies and non-renewal of contracts.
Business confidence improved slightly but remained below historical averages, with concerns over falling backlogs and the domestic automotive sector affecting sentiment.
(Reporting by Maria Martinez; Editing by Toby Chopra)
Key Takeaways
- •Germany's manufacturing PMI fell to 48.2 in November.
- •New orders declined at the fastest rate in ten months.
- •Exports suffered steep declines due to weaker global demand.
- •Production increased for nine consecutive months.
- •Business confidence remains below historical averages.
Frequently Asked Questions about German manufacturing sector faces sharp decline in new orders, PMI shows
1What are new orders?
New orders refer to the total number of orders received by manufacturers for products that have not yet been fulfilled. A decline in new orders can indicate a slowdown in manufacturing activity.
2What is business confidence?
Business confidence reflects the degree of optimism or pessimism that business leaders feel about the overall economic situation. It influences investment and hiring decisions.
3What is employment decline?
Employment decline refers to a reduction in the number of jobs available in a sector or economy. It can be a sign of economic downturn or reduced business activity.
4What is economic contraction?
Economic contraction is a decline in national output as measured by GDP. It indicates a slowdown in economic activity and is often associated with rising unemployment.
