FX.co ★ Germany Construction Activity Remains Subdued

In September 2025, the HCOB Germany Construction PMI slightly increased to 46.2 from 46 in August. Despite this minor rise, it still reflects an ongoing downturn in construction activity within Germany, the eurozone's largest economy, primarily due to weak demand. The housing sector remains the primary factor in this decline, experiencing its sharpest contraction in three months. Although new orders continue to decrease, the rate of decline is the slowest it has been for three months, yet this has still led to further employment reductions in the sector. On a positive note, the slowdown in the decline of purchasing activity by constructors was the least significant in over three years. In terms of pricing, input cost inflation surged to a three-month high. Additionally, constructors reported the most significant increase in subcontractor rates since July 2023. Finally, while there was a slight improvement in business expectations for the coming year, overall sentiment remains pessimistic.