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2/1, 9:55 AM (Source: TeleTrader)
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German factory activity declines more last month

Data collected by IHS Markit and BME among German purchasing managers confirmed on Friday that the manufacturing sector contracted in January for the first time since November 2014. The reading of the headline index dropped to 49.7 points from 51.5 and the reading was 0.2 points lower than in the initial update. The 50-point mark separates the reduction in activity from expansion.

"Thanks to a strong rise in consumer goods output, overall production remained just inside growth territory in January, but there are growing risks to the near-term outlook. Stocks of finished goods rose the joint-most on record, backorders continued to be depleted, and firms' expectations towards future output showed no appreciable improvement from last October's six-year low," said Phil Smith, IHS Markit's principal economist.

New orders fell for the fourth month in a row and the most in six years and input cost growth landed at a 27-month low. Respondents cited clients' hesitation, trade disputes and a slowdown in the automotive segment. Output grew marginally and the outlook worsened, but hiring increased above average.

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