FX.co ★ Germany Construction Downturn Sharpest in 7 Months

In October 2025, Germany's HCOB Construction PMI decreased to 42.8, falling short of expectations that projected it would rise to 46.9 from September's 46.2, indicating the most significant decline in activity since March. Each of the three major construction sectors experienced setbacks, with housing activity being the hardest hit and civil engineering sliding back into contraction after two consecutive months of growth. Although new orders continued their downward trend, they fell at the slowest rate since April, providing a slight boost to firms' outlook for the coming year. Employment figures and purchasing levels both saw reductions; purchasing activity dropped significantly, while the workforce saw a slight decrease. Notably, supplier delivery times extended for the first time in nine months. The increase in average input prices decelerated, whereas charges from subcontractors rose at their highest rate in over two years. Overall, construction firms maintained a pessimistic outlook due to sluggish demand, elevated costs, and high long-term interest rates.