German Factory Activity Concludes 2024 with Accelerated Decline, PMI Indicates

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As of the end of 2024, German factory activity has experienced a significant decline. The HCOB Germany Manufacturing Purchasing Managers' Index (PMI) fell to 42.5 in December from 43.0 in both October and November. This decline indicates that the manufacturing sector continued to contract at an accelerated pace, reflecting ongoing challenges in the industry.

Throughout 2024, German industrial production saw a persistent downturn. The PMI for the industrial sector in Germany was at 42.4 in August 2024, and it remained below the 50-point threshold, which separates expansion from contraction, for most of the year. The German business association BDI also reported that the industry expected a 3% drop in production for 2024.

Additionally, the Eurozone manufacturing PMI, which includes Germany, has been below 50 for over two years, indicating a prolonged period of contraction. This broader trend underscores the systemic challenges facing German manufacturers, including weak demand, high uncertainty, and a decline in new orders.

Overall, the data suggests that German factory activity ended 2024 on a sour note, with a notable decline in manufacturing activity as reflected in the PMI readings.

German Factory Activity Concludes 2024 with Accelerated Decline, PMI Indicates

Preview

Overall, the data suggests that German factory activity ended 2024 on a sour note, with a notable decline in manufacturing activity as reflected in the PMI readings.