(Il Sole 24 Ore Radiocor) - Milano, 1 apr - In March, Germany's purchasing managers' index for the manufacturing sector increased to 52.2 in March from 50.9 in February, the highest reading since May 2022, according to data released by S&P Global.

A reading above 50 signals expanding sector activity while one below a contraction.

S&P Global noted that while there were positive contributions from the output and new orders components of the index, the main driver of the rise in the headline PMI was the suppliers' delivery times index, which is inverted in the calculation due to longer lead times usually being associated with stronger demand.

"The immediate impacts of the war in the Middle East on the German manufacturing sector are clear to see in March's PMI results. Most notably, input cost inflation has spiked higher on the back of the surge in oil and gas prices, registering its largest single-month rise on record," commented Phil Smith, economics associate director at S&P Global Market Intelligence.

"We're already starting to see signs of stress across supply chains, with lead times on inputs lengthening to the greatest extent since mid-2022. This has helped boost the headline PMI, due to the assumption that longer delivery times are usually associated with increased demand. March did in fact see stronger rates of output and new order growth, even against the backdrop of the Middle East war.

"However, given that the increase in demand at least partly reflected attempts by businesses to build buffer stocks and mitigate future price increases, we could see some payback in future months. Manufacturers themselves have revised down growth forecasts for the coming year, with heightened levels of uncertainty and strong inflationary pressures expected to eventually act as headwinds to demand and production. Of course, so much depends on the duration of the war in the.

Middle East."

(RADIOCOR) 01-04-26 10:09:14 (0230) 5 NNNN