HAMBURG/FRANKFURT: It must have been a frustrating week for Germany's manufacturers. Hamburg is trying to become uncongested following a bout of bad weather (global warming?) and slow-steaming, cost-conscious megaship operators, while Lufthansa's pilots went on strike and lost the company "€35-75 million" in revenue.
According to a spokesman for Lufthansa Cargo, it had to put 4,500 tonnes of airfreight on other airlines.
This logistics hiatus follows the March Markit/BME Germany Manufacturing PMI that slid from 54.8 to 53.7. Despite a four-month low, the latest reading was above the long-run trend and rounded off the best quarter on average in almost three years.
The PMI suggests Germany's manufacturing firms showed a sharp increase in production and new orders rose for the ninth consecutive month. New export orders also increased in March but at the lowest pace for the past five months. The overall rise in new exports was driven by stronger demand from a wide range of countries including China, Spain and the U.S.
Oliver Kolodseike, Markit economist and author of the latest report commented: "Germany's goods producing sector lost some of its recently strong growth momentum in March, as highlighted by the headline PMI slipping to a four-month low. Output and new business orders rose at sharp, albeit weaker rates, adding evidence that the manufacturing upturn has moderated slightly...On the bright side, the current period of positive PMI readings now stretches to nine months, and despite weaker growth in March, the German manufacturing economy rounded off its strongest quarter in nearly three years."
Meanwhile Eurozone manufacturing expanded for its ninth consecutive month in March. Although the PMI dipped to a three-month low of 53.0 from 53.2 in February, the average reading of 53.4 for the first quarter was the best since the second quarter of 2011. Slowdowns in February's top performers – Germany, the Netherlands and Austria – were largely offset by faster growth in Ireland (35-month high), Spain (47-month high) and Italy (2-month high) and a return to expansion in France that took its PMI to a 33-month peak.
Chris Williamson, Markit chief economist noted: "The rate of output growth remains encouragingly robust, with the survey indicating that production rose by around 1.0 percent in the first quarter. That means the goods- producing sector is on course to provide a meaningful boost to the overall economy in the first three months of the year. The surveys are signaling a GDP increase of approximately 0.5 percent."