The Strategist

German services sector shows record growth

04/06/2023 - 11:31

As a result of increased demand, Germany's services sector expanded in March at its quickest rate since last May, as shown in data from S&P Global.

La Citta Vita
La Citta Vita
The services purchasing managers' index (PMI) increased from 50.9 in February to 53.7 in March. A reading of the index above 50 denotes a rise in activity from the previous month.

According to Paul Smith, deputy economic director at S&P Global, "Germany's services sector showed growth at the end of the first quarter, with greater business activity gaining speed as demand continues to revive following a pause late last year."

It's still unclear, though, if this will be sufficient to keep the GDP from falling for a second consecutive quarter, which would prevent a formal recession.

The most optimistic scenario for the coming quarter, according to Smith, is moderate economic growth because new manufacturing orders are still being pressured and business optimism did not increase in March.