08.04.202110:49:00UTC+00German Construction Sector Continues To Contract In March

Germany's construction sector continued to shrink in March but the pace of decline slowed from February, survey data from IHS Markit showed on Thursday.

The construction Purchasing Managers' Index rose to 47.5 in March from 41.0 in February.

Nonetheless, a score below 50 indicates contraction in the sector and the latest reading was the second-highest since the start of the coronavirus disease 2019 pandemic behind that seen last August.

Survey respondents reported bad weather in March, alongside delays caused by long wait times on planning permissions and a soft patch in demand.

Commercial activity recorded its shallowest decline for 13 months, though was still the worst-performing sub-sector narrowly behind civil engineering. Housing activity recorded the slowest contraction.

Phil Smith, an associate director at IHS Markit, said reports from surveyed businesses indicated that the sector continued to be held back by a soft patch in new orders linked to the impact of the pandemic on clients' willingness and ability to invest, with several firms also commenting on delays in planning permissions.