Germany's Factory Orders Fall Most Since 2009

21 March, 2017, 11:51 | Author: Leticia Walters

German factory orders plunged by 7.4 percent in the first month of the year, the National Statistics Office (Destatis) reported Tuesday.

New orders are highly volatile, but the fluctuations and size of volatility since late-summer have been nearly unprecedented, Carsten Brzeski, an ING economist, said.

"The strong increase in orders in the final quarter of 2016 makes a weak start to the new year manageable", the federal economy ministry in Berlin said.

January's drop was the largest since 2009.

Total industrial production rose by 2.8% month-on-month in January, helping to nudge the year-on-year rate of advance to 0.0% from -0.1%.

Sentiment surveys are also signalling a continued positive business climate, meaning the industrial upswing is likely to gain further momentum, the ministry said. "They expect a revival of exports", said Sophia Krietenbrink of the DIHK Chambers of Industry and Commerce.

Both the economy ministry and Commerzbank pointed out that much of the drop was down to large contracts - a volatile item that can see large swings from month to month. Industrial production in Germany grew 2.8 per cent in January, preliminary data showed today, comforting fears that global uncertainty could put the brakes on Europe's largest economy.

Domestic orders logged a double-digit fall of 10.5 percent and foreign orders decreased 4.9 percent in January.

Industrial orders from the 19-member eurozone contracted faster then those from nations outside the single currency area.

The biggest fall came for capital goods makers, who saw 9.9 percent fewer orders, while producer goods firms lost 4.0 percent and consumer goods 2.0 percent.

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