Germany’s Business Activity Climbs to Four-Month High in February

Germany’s private sector expanded at its fastest pace in four months in February, signaling renewed momentum in Europe’s largest economy. The HCOB Flash Germany Composite Purchasing Managers’ Index, compiled by S&P Global, rose to 53.1 from 52.1 in January, surpassing analysts’ expectations. A reading above 50 indicates growth, pointing to stronger overall business activity across the country.

The services sector remained the main driver of expansion, with its PMI rising to 53.4 from 52.4, beating forecasts. Meanwhile, manufacturing returned to growth for the first time since June 2022, with the index climbing to 50.7 from 49.1 in January. The rebound in factory output marks a significant turnaround after more than three years of contraction.

Economists said the data supports signs of a broader economic recovery, following an unexpected surge in German industrial orders in December — the biggest increase in two years. While employment levels continued to decline, the pace of job losses slowed considerably, suggesting stabilizing conditions. Analysts indicated that Germany’s gross domestic product is likely to post visible growth in the first quarter, barring any unexpected downturn in March.

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