German services growth accelerates further in March, adds to signs of strong Q1 growth

Data released by IHS Markit on Wednesday showed that growth in Germany's services sector accelerated further in March. Markit's German final services index rose to a 15-month high of 55.6 from 54.4 in February. Data added to signs that Europe's largest economy will post healthy growth in the first quarter.

Markit's German final composite Purchasing Managers' Index (PMI) rose to 57.1 from 56.1 in February to reach a 70-month high. Today's upbeat data follows Markit's final manufacturing PMI released on Monday which showed growth had accelerated at the strongest rate in nearly six years in March.

New business growth and job creation strengthened further in March to the fastest in around six years, and the 12-month outlook is the brightest since at least mid-2012. Cost pressures continue to build, however. Input price inflation has accelerated continuously since last September, reaching a near-six year high in March.

"The final services PMI data for March completed a picture of strengthening economic growth in Germany in the opening quarter of 2017," Markit economist Trevor Balchin said.

He added that the data reinforced Markit's full-year growth forecast of 1.9 percent this year for Europe's largest economy.