(MENAFN) Recent data compiled by S&P Global has revealed a significant decline in German manufacturing activity in February, falling well below economists' expectations and hitting its lowest level in four months. The manufacturing purchasing managers' index (PMI) in Germany dropped from 45.5 in January to 42.3 this month, indicating an accelerated economic downturn. The overall business activity in the country also slipped to 46.1 from 47, with any reading below 50 signaling a contraction.

The challenges faced by German factories include a downturn in global demand, particularly from China, coupled with high-interest rates and expensive energy. The figures showed a sharp decrease in manufacturing output and a steeper contraction rate, emphasizing the sector's growing difficulties.

Tariq Kamal Chaudhry, an economist at Hamburg Commercial Bank, commented on the data, stating that after a glimmer of hope in recent months, German industry is now facing a bleak outlook. The data reveals a decline in output, accompanied by plummeting new orders both domestically and internationally. With fears of a deepening downturn in the European Union's top economy, manufacturers are increasingly pessimistic about the outlook for 2024.

S&P Global highlighted that manufacturing and exports in Germany experienced a rapid decline in new business, contributing to the economic challenges faced by the country. As Germany navigates these headwinds, global economic dynamics and internal factors continue to impact its manufacturing sector, requiring strategic responses to address the ongoing downturn.

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