Germany: slight rise in construction output in December 2014

The seasonally adjusted Markit Germany Construction Purchasing Managers’ Index^® (PMI^®) came in at 50.5 in December 2014, remaining above the 50.0 no-change mark. This represents a third consecutive month of growth in construction output but a slower rate of expansion when compared to the PMI^® of 53.5 recorded in November 2014.

Of the three construction sectors considered by the index, residential activity increased but at a more moderate pace than in November, while commercial and civil engineering output contracted slightly.

The level of new work fell in December, as it has done in Germany since April 2012. Meanwhile, input prices were up and the rate of cost inflation reached a three-month high.

“Germany’s construction PMI remained in expansion territory at the end of the year, but the rate of activity growth slowed to only a marginal pace. The expansion in construction output was solely driven by a rise in housing activity, while work on commercial and civil engineering building projects declined. Furthermore, falling employment levels and a pessimistic outlook for the year ahead suggest that we’re unlikely to see any meaningful and sustainable upturn in construction output in the near-term,” noted Markit Economist Oliver Kolodseike.

Adapted from press release by Louise Fordham

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