According to a report released by Markit Economics today, May 5, the rebound witnessed in Q1 in Germany's construction activity lost some momentum during April. The country's total construction industry activity continued to grow solidly, but the rate of increase weakened from March's record high. Meanwhile, employment and input buying increased at their slowest rates so far this year. Input cost inflation also slowed, but still remained marked. Sentiment regarding Germany's construction industry's future activity was little changed in April, despite a decline in the number of new business wins by companies in the sector.
At 55.8 in April, down from 61.8 in March, the seasonally adjusted German construction purchasing managers' index signaled that growth of output weakened, but nonetheless remained robust. The latest anecdotal evidence suggested that despite a reduction in new work in April, outstanding workloads at construction companies were sufficient to permit an increase in total activity.
Purchasing activity continued to rise in April, but the rate of growth eased sharply since March. Higher demand for raw materials resulted in a further deterioration in supplier performance, with lead times lengthening to the greatest extent for four months.
Rising raw material costs underpinned another month of strong input cost inflation. However, the rate of increase in purchase prices weakened to a three-month low.