The downturn in German construction activity deepened at the end of the first quarter of the current year, driven largely by a sharp and accelerated decrease in home building. Markit's Germany Construction Purchasing Managers Index (PMI) dropped to a 13-month low of 41.9 points in March, down from 43.8 in February. Germany's construction industry activity has now decreased for 12 successive months, with the latest fall partly attributed to unusually bad weather conditions in Germany.
The first quarter of the current year saw faster rates of decline in employment and purchasing activity, with firms facing another steep drop in intakes of new orders. A more welcome development, according to Markit Economics, was a reduction in cost inflation to the slowest rate in six months, albeit one that was still solid overall.
