German manufacturing growth accelerates in August as orders surge, PMI shows

BERLIN, Sept 1 (Reuters) - ‌Germany's manufacturing sector ​accelerated ​in August, as a jump in new orders drove the strongest production growth since January ‌2022, a business survey showed on Tuesday.

• The ⁠S&P Global final Purchasing Managers' Index for German manufacturing rose to ‌54.3 in August from 52.2 ‌in July, slightly above a preliminary reading of 54.1.

• A solid rise in new orders, for the third ​month in a row, drove the strongest production growth in more than 4-1/2 years, the data showed. ⁠Firms cited defence spending, data centre build-outs and stockpiling as drivers of demand.

• ​Supply pressures also intensified: Supplier delivery times lengthened to the greatest extent in three months, ​while purchasing activity grew at its ‌fastest pace since May 2022 as firms sought to secure inputs amid tight availability.

• ⁠Phil Smith, economics associate director at S&P Global Market Intelligence, said the upturn was being led by the intermediate goods sector, ⁠suggesting growth is still being supported to a degree by safety ​stockpiling amid tight supply conditions.

• "The mood among businesses about output in the year ahead has improved noticeably and is now the brightest ‌seen since the Middle East conflict began," added Smith.

• Employment kept falling, but the ‌pace of job cuts eased for a third month and ⁠was the weakest since ‌September 2023.

• Backlogs ​of work increased solidly, ending a three-month run of decline.

(Reporting by Miranda Murray; Editing by Hugh ‌Lawson)

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