Germany: Services PMI falls in June
The HCOB Germany Services Purchasing Managers’ Index (PMI) fell to 53.1 in June from May’s 54.2. As a result, the index remained above the 50.0 no-change threshold but signaled a softer improvement in services-sector business activity compared to the previous month.
While growth in services sector activity slowed, the expansion was robust by historical standards, buoyed by marketing and sales efforts, lower interest rates, the European Football Championship—which were held in Germany during the month, boosting tourism—and overall stronger underlying demand. Additionally, the inflow of new work from non-domestic customers experienced a faster increase, supporting the sector’s overall performance. Meanwhile, firms continued to hire in the month, albeit at a slower pace.
Regarding prices, June saw the lowest rate of input cost inflation since March 2021, though price growth remained elevated due to wage pressures. As a result, output charges saw a slight increase from May’s recent low. Lastly, business sentiment weakened, with optimism regarding future growth prospects falling to its lowest since January, partly due to a fading temporary boost from the European Football Championship and concerns over potential lower activity levels in June 2025 without such events.