FX.co ★ German Manufacturing Unexpectedly Contracts

In September 2025, Germany’s HCOB Manufacturing PMI decreased to 48.5 from 49.8 in August, contrary to market predictions which anticipated stabilization at 50, according to preliminary estimates. This reading indicates the steepest contraction in the past four months. While production continued to grow, the pace was more subdued compared to August. Additionally, new orders suffered their first decline in four months, marking the sharpest drop since January. Export sales fell for the second month in a row. Companies turned to current backlogs to sustain output, but outstanding business levels fell at the fastest rate seen in nine months. Employment figures reflected further declines, with workforce numbers shrinking at the most rapid pace in three months. Regarding costs, purchasing prices saw a more significant reduction than in August, and output charges also decreased. Business outlooks dimmed for the second consecutive month, falling below the long-term average, as sluggish demand and high operating costs persisted.