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German private sector growth picks up in August
[BERLIN] Stronger-than-expected growth among manufacturers helped Germany's private sector expand at a faster rate in August, a survey showed on Friday, suggesting Europe's largest economy is on track for a solid third quarter.
Markit's flash composite Purchasing Managers' Index (PMI), which tracks manufacturing and services activity that accounts for more than two-thirds of the economy, inched up to 54.0 from 53.7 in July.
This was comfortably above the 50 mark that separates growth from contraction and marked the 28th consecutive month of economic expansion. "Germany's private sector economy shifted into a higher gear in August with output and new orders both increasing at the sharpest rate in four months," Markit economist Oliver Kolodseike said.
The German manufacturing index rose to 53.2 from 51.8 in August, marking the highest level in 16 months and comfortably beating a Reuters poll consensus for 51.7.
Despite concerns over a cooling global economy, new export orders for goods producers rose to their highest level in 1-1/2 years, with demand coming from Britain and the United States in particular.
The sub-index for services slipped slightly to 53.6 after 53.8 last month. The polled analysts had forecast a reading of 53.9.
The German economy grew by 0.4 per cent in the three months to June and Kolodseike said the PMI pointed to a similar rate of growth in the third quarter.
Alongside strong domestic consumption, growth has been supported by a pick-up in foreign trade thanks to a moderate recovery in the euro zone and strong price competitiveness. Detailed PMI data are only available under licence from Markit and customers need to apply to Markit for a licence.