03.07.202608:23:26UTC+00German Service Sector Contracts for a Third Month

Germany’s Services PMI was revised sharply higher to 48.6 in June 2026, up from the preliminary estimate of 46.8 and above May’s final reading of 48.1. Despite the upward revision, the index still pointed to a third consecutive monthly contraction in service sector activity, as subdued demand continued to drag on performance.

New orders fell for the fourth month in a row, with the pace of decline accelerating compared with May. Surveyed firms attributed the weakness to challenging economic conditions, including tighter financial conditions and subdued domestic confidence. A notable deterioration in foreign demand further weighed on overall new business.

Outstanding business continued to decline, employment fell for the sixth consecutive month, and backlogs were cleared at the fastest rate since August 2025. On the price front, both input and output cost inflation eased from recent peaks, helped in part by lower fuel costs. Meanwhile, business confidence deteriorated further in June.