German economy - Economic stimulus - serious problem in Germany
For the German economy, there is another mood dampener. In the largest economy of the Eurozone, the purchasing manager index for industries and services calculated by S&P Global has surprisingly declined further.
It fell to 48.7 points and for the first time in four months below the growth threshold of 50 points, as financial services provider S&P in London announced. The value for industrial companies reached the lowest level in nine months.
"This looks serious," commented Cyrus de la Rubia, Chief Economist of S&P Partner Hamburg Commercial Bank, on the survey figures. "The German economy has fallen back into the contraction zone."
The economy in the Eurozone also received another dampener. In July, the mood in the companies worsened again and reached the lowest level since five months. The purchasing manager index fell by 0.8 points to 50.1 points. However, analysts had expected an average stagnation of the index value at 50.9 points. The sentiment indicator is holding itself only just above the growth threshold of 50 points, which still indicates a slight expansion of economic activities.
The decline in the S&P Global's purchasing manager index for the German economy, a key indicator in the European Monetary Union, have raised concerns in London. This extends the streak of negative sentiments in the Eurozone's economy, as the index fell below the growth threshold for the first time in four months. Despite a slight expansion of economic activities indicated by the index's holding above 50 points, Germany, being one of Europe's major economies, is facing another period of contraction.
