Supply-Chain Bottlenecks Drag German Manufacturing to Six-Month Low

Source: IHS Markit

German manufacturing cooled to a six-month low in August, as firms grappled with supply chain issues during the period. EWG is up 0.31%.

• The headline IHS Markit/BME Germany Manufacturing PMI fell to 62.6 in August from 65.9 in July.
• The latest reading is the lowest since February but still above the 50.0 threshold that separates expansion from contraction.
• The biggest drag came from the output subcomponent, which plunged to a 12-month low, while new order growth fell to a three-month low.
• Most of the respondents indicated longer lead times but dipped from the peak recorded in May.
• Backlogs rose sharply, while finished goods declined as firms used up their remaining inventory to meet demand.
• Input stocks fell, while input cost inflation saw a slight decline from the all-time high in July.
• Optimism on future activity fell to lowest in 10 months, dragged by supply issues.