The decline in the German economy slowed in November
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Although the Composite Purchasing Managers Index (PMI) in Germany increased by 1.2 points to 47.1 points in November, it remained below 50 points, which indicates a contraction.
Although the Composite Purchasing Managers Index (PMI) in Germany increased by 1.2 points to 47.1 points in November, it remained below 50 points, indicating a contraction, for five consecutive months.
HCOB (Hamburg Commercial Bank) leading PMI data for November, prepared by S&P Global, has been announced. Accordingly, the composite PMI, which was 45.9 in October, remained above expectations, rising to 47.1 in November.
Thus, the index remained below 50 points, indicating a contraction, for five consecutive months. The expectation was that the index would rise to 46.5.
The service sector PMI in the country increased from 48.2 to 48.7 in November.
While the manufacturing industry PMI increased from 39.1 to 39.8 in the month in question, it continued to remain in the contraction zone.
‘THERE IS A LITTLE HOPE’
In his assessment of the issue, Cyrus de la Rubia, Chief Economist of the Hamburg Commercial Bank, said: “Christmas is approaching and there is some hope for the German economy. Although we remain in the recession zone, the pace of the slowdown has visibly slowed down. “The strong increase in almost all sub-indices is particularly encouraging.” he said.
La Rubia stated that a return to the growth zone in PMI (above 50 points) is a reasonable possibility and will potentially occur in the first half of the year, adding: “There is a positive development in manufacturing due to the decrease in the decline in new orders. “This is supported by both domestic and international orders.” made his assessment.
Cyrus de la Rubia stated that they expect a 0.7 percent contraction in the German economy in the fourth quarter of the year. Previously, this expectation was 0.9 percent.
In PMI data, above 50 points indicates growth, while below 50 points indicates contraction.
Manufacturing and services sectors account for more than two-thirds of the German economy.
DANGER OF RECESSION
The country’s economy shrank by 0.1 percent in the third quarter of the year compared to the previous quarter due to weak purchasing power and high interest rates. If the German economy shrinks in the last quarter, it will contract for two consecutive negative quarters and enter a technical recession.
On October 11, the government updated its growth expectation, which was previously announced as 0.4 percent for this year, to minus 0.4 percent due to the stagnation in the global economy.
The International Monetary Fund also reduced its growth expectation for Germany from minus 0.3 percent to minus 0.5 percent, reporting that Germany would be the only developed country to shrink this year. (AA)
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