German Expansion Slows With Manufacturing Growth at Two-Year Low

(Bloomberg) -- Germany’s economic expansion lost further momentum in September as growth in the manufacturing industry slowed to the weakest in two years.

IHS Markit’s Purchasing Managers’ Index of manufacturing and services fell to 55.3 in from 55.6 in August, IHS Markit said on Friday. Economists had forecast a decline to 55.4.

German Expansion Slows With Manufacturing Growth at Two-Year Low

With services growth picking up, the drop was led by the manufacturing sector, which saw a gauge drop to the lowest since August 2016. New orders barely grew in the month, while a measure of expected future output tumbled.

Germany’s reliance on exports means the economy is vulnerable to rising protectionism from U.S. President Donald Trump, while emerging markets from Turkey to Argentina remain in turmoil. European Central Bank President Mario Draghi last week singled out global risks as the main threat to otherwise solid expansion of the euro-area economy.

IHS Markit’s composite gauge for the euro area is forecast to hold at 54.5. That report is published at 10 a.m. Frankfurt time. The composite PMI for France dipped to a 21-month low.

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