July’s PMI rise marks the fastest factory expansion in over four years as export demand drives output growth and cost pressures ease.
Germany’s manufacturing PMI climbed to 52.2 in July from 50.3 in June, matching market expectations. The increase signals the strongest factory activity expansion since early 2020, fueled by a rebound in export demand and improved output growth.
The June print of 50.3 had barely avoided contraction, while consensus forecasts had centered on a modest uptick. Input cost inflation also softened, providing additional relief to producers amid persistent supply chain challenges.
Markets are watching for sustained momentum as the sector’s recovery could support broader economic stabilization in the eurozone’s largest economy.