German services sector grows in September on strong demand, PMI shows

By Maria Martinez

BERLIN, Oct 5 (Reuters) - Germany's service sector saw solid growth in business activity in September, supported by a sustained recovery in demand, a business survey showed on Monday.

The final S&P Global Germany Services Purchasing Managers' Index rose to 52.9 in September from 49.7 in August, reaching the highest reading since just before the start of the Middle East conflict in February.  

• The upturn came despite a revival in inflationary pressures across the sector.

• Employment rose for the second month running, in line with signs of growing capacity pressures and hopes of further growth in activity ahead.

• Reports from surveyed businesses pointed to improved demand from clients, including signs of greater investment spending.

• "The rise in business activity in September reinforces the tentative signs of recovery we've been seeing in the services sector for a few months now," said Phil Smith, S&P Global Market Intelligence economics associate director.

• The final S&P Global Germany Composite PMI, which includes services and manufacturing, rose to 53.8 in September, up from 51.8 in August, reaching its highest reading for almost a year.

• A reading above 50 signals growth, while one below it indicates contraction. The further it goes below 50, the faster the rate of contraction.

(Reporting by Maria Martinez; Editing by Toby Chopra)