{"id":430762,"date":"2026-05-21T14:40:20","date_gmt":"2026-05-21T07:40:20","guid":{"rendered":"https:\/\/www.swingfish.trade\/blog\/market-news\/2026\/05\/german-business-activity-falls-for-a-second-consecutive-month-amid-rising-cost-pressures\/"},"modified":"2026-05-21T14:40:20","modified_gmt":"2026-05-21T07:40:20","slug":"german-business-activity-falls-for-a-second-consecutive-month-amid-rising-cost-pressures","status":"publish","type":"post","link":"https:\/\/www.swingfish.trade\/blog\/market-news\/2026\/05\/german-business-activity-falls-for-a-second-consecutive-month-amid-rising-cost-pressures\/","title":{"rendered":"German business activity falls for a second consecutive month amid rising cost pressures"},"content":{"rendered":"<div>\n<ul>\n<li>Manufacturing PMI 49.9 vs 51.0 expected<\/li>\n<li>Prior 51.4<\/li>\n<li>Services PMI 47.8 vs 47.0 expected<\/li>\n<li>Prior 46.9<\/li>\n<li>Composite PMI 48.6 vs 48.4 expected<\/li>\n<li>Prior 48.4<\/li>\n<\/ul>\n<p class=\"text-align-justify\">After the dismal French numbers earlier, this is arguably some little bit of comfort for investors despite German economic activity showing a contraction for a second month running. The Middle East conflict continues to bite at demand conditions while at the same time driving up price pressures in Europe&#8217;s largest economy.<\/p>\n<p class=\"text-align-justify\">As manufacturing activity starts to feel the heat now after the frontloading in March and April, the only bit of good news is that at least the services sector did not suffer worse conditions than seen in April.<\/p>\n<p class=\"text-align-justify\">With the German economy poised to contract in the second quarter now, stagflation risks will be a key concern. That especially as firms continue to report a further intensification of cost pressures, as input price inflation continues to accelerate.<\/p>\n<p class=\"text-align-justify\">S&amp;P Global notes that:<\/p>\n<p class=\"text-align-justify\">&#8220;With the &#8216;flash&#8217; PMI data for May signalling a second<br \/>\nconsecutive monthly decrease in business activity,<br \/>\nthe German economy is on course to contract in the<br \/>\nsecond quarter of the year. In manufacturing, the boost<br \/>\nthat we saw from efforts to build stocks and get ahead<br \/>\nof price increases and supply shortages appears to be<br \/>\nfizzling out, with the latest data showing a renewed<br \/>\ndrop in new orders and a near-stalling of output growth.\n<\/p>\n<p class=\"text-align-justify\">&#8220;The disruption from the effective closure of the Strait<br \/>\nof Hormuz continues to filter through to prices, with<br \/>\ninput cost inflation showing a further acceleration due<br \/>\nto the knock-on effects of higher energy prices and<br \/>\nsupply shortages.\n<\/p>\n<p class=\"text-align-justify\">&#8220;Although input cost inflation has continued<br \/>\naccelerating, slower rises in both manufacturing and<br \/>\nservices output prices point to businesses shouldering<br \/>\na greater proportion of the burden. This suggests<br \/>\nsome containment of inflationary pressures, but it also<br \/>\nhints at an increased squeeze on company margins<br \/>\nwhich has consequences of its own, not least for the<br \/>\nlabour market as firms look to mitigate spiralling costs.<br \/>\nEmployment fell at the quickest rate for over a yearand-a-half in May, led by deep cuts to manufacturing<br \/>\nworkforce numbers.&#8221;<\/p>\n<p>                            This article was written by Justin Low at investinglive.com.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Manufacturing PMI 49.9 vs 51.0 expected Prior 51.4 Services PMI 47.8 vs 47.0 expected Prior 46.9 Composite PMI 48.6 vs 48.4 expected Prior 48.4 After the dismal French numbers earlier, this is&hellip;<\/p>\n","protected":false},"author":216,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[86],"tags":[],"class_list":["post-430762","post","type-post","status-publish","format-standard","hentry","category-market-news"],"_links":{"self":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/430762","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/users\/216"}],"replies":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/comments?post=430762"}],"version-history":[{"count":0,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/430762\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/media?parent=430762"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/categories?post=430762"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/tags?post=430762"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}