German industrial orders rise in August

Source: Xinhua | 2018-10-07

New orders received in Germany's industrial manufacturing sector rose in August after several months of decline, official figures by the Federal Statistical Office (Destatis) showed on Friday.

According to the Office, industrial orders were up by a price- and seasonally-adjusted rate of 2.0 percent in August compared to the previous month.

Although new orders were 2.1 percent lower compared to August 2017, the figure marked the reversal of an earlier trend of monthly decline, which was largely attributed to uncertainty in the global economy due to growing protectionism.

Excluding major orders, which can lead to short-term distortions of the data compiled by the Office, seasonally- and price-adjusted industrial orders in August increased by a monthly rate of 3.3 percent.

Broken down by regions, the figures reflected strong international demand from non-Eurozone countries that was offsetting falling ones within the single currency area and Germany itself. Domestic German and Eurozone orders declined by 2.9 percent and 2.2 percent respectively compared to July, while orders from the rest of the world soared by 11.1 percent during the same period.

The producers of capital goods were the best performing individual industrial sector for new orders (3.4 percent) in August, ahead of consumer goods producers (2.1 percent) and intermediate goods producers (0.1 percent).

Speaking to Xinhua on Friday, Thiess Petersen, Senior economics expert at the Guetersloh-based Bertelsmann Foundation, said that the latest figures offered a "small positive signal" after several previous months in which industrial orders had declined. He noted that the increase in August was reflective of improved expectations for economic growth in Germany measured in recent surveys.

For Petersen, the enhanced performance of the sector in August was mainly due to the temporary de-escalation of ongoing trade conflicts.

At the same time, however, Petersen cautioned that there were still "many remaining growth risks" which could still upset the recovery of German industrial orders. "It is still unclear how the economic relationships (between the EU and Britain) will look after Brexit at the end of March 2019," he warned.

Ongoing "economic turbulences" in Turkey were a further development of concern to investors and companies cited by Petersen. As a consequence, uncertainty over the continued economic development of Germany and Europe generally remained high.