- Construction PMI 42.4
- Prior 42.1
The sharp contraction in Germany’s construction sector continues in May, as pressure continues to ramp up on both demand conditions and on the price front. New orders continued to decline at a sharp rate, albeit slightly better than in April. Of note, panellists indicated strong headwinds to
demand from heightened levels of uncertainty and elevated
price pressures.
As for inflation pressures, the rate at which input prices rose held close to April’s
47-month high. That was driven by a continued increase in the cost of energy and oil-based products.
Meanwhile, firms also faced worsening supply delays in
May as average lead times on building materials and products lengthened to the greatest extent since July 2022 amid reports of logistics issues and supply shortages.
While there is some improvement in housing and commercial activity on the month, they remain at subdued levels and are now joined by a more protracted downturn in civil engineering activity:
That spells trouble for the industry and the construction sector as the Middle East conflict drags on and is set to weigh on conditions further.
