03.06.202608:00:55UTC+00Germany Services Sector Remains in Contraction

The S&P Global Germany Services PMI was revised up to 48.1 in May 2026 from a preliminary estimate of 47.8 and compared with 46.9 in March, but it remained below the neutral 50 mark. New business declined for a third consecutive month, though the decrease was only marginal and the mildest in the current sequence. In contrast, export orders posted their steepest fall in a year.

Weaker inflows of new work led to a further reduction in backlogs, while firms continued to cut staff, extending the current run of job losses to five months, albeit at a slower pace. Input cost inflation stayed close to April’s three-year high, driven by rising energy, transport, and wage expenses. Companies passed on part of these higher costs to clients through increased selling prices, although output price inflation eased slightly amid strong competitive pressures and customer resistance to price hikes.

Looking ahead, business confidence strengthened to a three-month high, as firms expressed hopes for a more favourable geopolitical backdrop.