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Markit's Purchasing Manager's Index (PMI) for
the manufacturing sector, which accounts for about a fifth of
the
economy, rose to 51.2, the same as a flash reading, from 49.5 in
November. The November figure was the lowest since mid-2013 and
below the 50.0 threshold dividing growth from contraction.
New orders picked up, albeit modestly, after three months of
declines, with firms reporting growth in export business and
orders from the home market.
"Some relief was offered by December’s survey results, as the
PMI edged back into expansion territory and new orders returned
to growth," said Markit economist Oliver Kolodseike.
"However, it is too early to say whether or not the
manufacturing economy has entered the fast lane again or whether
the uptick in the data is just a temporary bright spot.
"With oil prices at levels not seen since 2009, input costs fell
further in December," he added. "The accelerated drop in input
prices is a positive development for manufacturers, but adds to
fears of wider disinflationary pressures."
A meagre growth rate of 0.1 percent in the third quarter helped
Germany skirt a recession after a contraction of 0.1 percent in
April-June.
Strong employment, rising wages and low interest rates are
helping prop up the economy, which has suffered from uncertainty
over the West's confrontation with Russia over Ukraine and
weakness in some euro zone partners.
German business morale rose in December for the second month
running, according to the closely-watched Ifo index, suggesting
the economy is on course to pick up in the fourth quarter.
(Reporting by Alexandra Hudson; Editing by Catherine Evans)
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