BERLIN: Germany's manufacturing sector expanded at its slowest pace in seven months in May, a survey showed on Monday, in a further sign that growth in Europe's largest economy is likely to slow down in the second quarter. Markit's Purchasing Managers' Index (PMI) for the German manufacturing sector, which accounts for about a fifth of the economy, fell to 52.3 in May from 54.1 in April, coming in above the 50 threshold that separates growth from contraction for an 11th straight month.
It was below the flash reading of 52.9. "Germany's manufacturing upturn lost some ground in May," said Oliver Kolodseike, economist at Markit.
"The latest survey results are a reminder that sustainable strong manufacturing growth cannot be taken for granted and that there may still be some more obstacles on the path to recovery." The German economy expanded at its fastest rate in three years in the first quarter, helped by an unusually mild winter, but is expected to grow more slowly between April and June.
The PMI survey showed orders increased at their slowest rate since October, factory output grew more slowly than in April, and job creation almost ground to a halt.
But company margins got a boost as output prices rose for the first time in three months while input costs dropped. - Detailed PMI data are only available under licence from Markit and customers need to apply to Markit for a licence.
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