FX.co ★ German Service Sector Contracts in April

Germany’s flash Services PMI dropped sharply to 46.9 in April 2026 from 50.9 in March, falling short of expectations of 50.3 and signaling the deepest contraction since November 2022. The figures indicate a marked downturn in service sector activity, with business volumes recording their steepest decline in nearly three and a half years. New orders fell significantly, underscoring weakening demand, while input cost inflation accelerated to its fastest pace since March 2023. In response, service providers raised output prices at the strongest rate in 35 months, pointing to persistent price pressures. Employment continued to decline as firms cut staffing levels, and backlogs of work shrank at a faster rate, highlighting softer demand and sustained pressure across the sector.