Investing.com - German private sector activity accelerated at the fastest rate in six months in August, according to survey data released on Thursday.
The preliminary reading of the Markit manufacturing purchasing managers’ index came in at 56.1 this month, down slightly from 56.9 in July. Economists had forecast a reading of 56.6.
A reading above 50.0 on the index indicates industry expansion, below indicates contraction.
The services PMI rose to a six month high of 55.2 from 54.1 a month earlier, against expectations for 54.3.
The composite output index, which measures the combined output of both the manufacturing and service sectors also rose to a six month high, climbing to 55.7 from 55.0. Economists had expected the composite index to tick up to 55.2.
“German business continued to display remarkable resilience during August, with the latest PMI data going some way to dispel any fears about a global trade slowdown and its impact on the health of the economy," said Phil Smith, principal economist at survey compiler Markit.
“Buoyed by strong fundamentals in the domestic market, including rising employment and wages, the service sector enjoyed an upturn in growth in August and drove the steepest rise in private sector business activity for six months.”
Stronger demand in the service sector offset the loss of momentum recorded in manufacturing, with total inflows of new business rising at the quickest rate since February.
It was a similar picture on the employment front, where the overall rate of job creation picked up to the fastest for seven months.
The report also pointed to an intensification of inflationary pressures across the German economy.
Average prices charged for goods and services rose sharply and at a rate that was only just below January’s record high. The report noted that the increase in service sector output charges was the second steepest on record.
Meanwhile, business confidence towards the outlook for activity over the next 12 months improved to the highest in four months in August, albeit with the degree of optimism remaining well below the levels seen at the start of the year.