Germany's services sector maintained a solid pace of expansion in June, marking its fourth consecutive month above the 50.0 threshold on the HCOB Germany Services PMI Business Activity Index. The index recorded 53.1, indicating continued growth, although slightly down from May's 12-month high of 54.2, signalling the first decline since January. Businesses increased activity is attributed to several factors, including intensified marketing and sales efforts, lower interest rates, the European Football Championships, and overall stronger demand. New work orders expanded for the third consecutive month, albeit at a slower rate compared to previous months, yet still robust by historical standards. International orders also saw a modest increase in growth. Employment in the German service sector rose in June, aligning with trends observed throughout the year so far. This increase reflected both current activity levels and optimistic expectations for future workloads. However, the pace of job creation moderated, marking the slowest rate since January following a sharp decline from May's 11-month high. Despite this, expanded staffing capacity contributed to a reduction in outstanding business among service firms, with the rate of backlog depletion being the quickest in four months. The data suggests resilience in the German services industry amid slight moderation, supported by domestic and international demand, while employment dynamics indicate cautious optimism for continued growth in the months ahead.
