- Dirk Schlotböller, German Chambers of Commerce and Industry
German factory orders have declined significantly, as demand for investment goods from outside the Euro zone slumped in April, strengthening worries about stagnation in the German industry. According to the latest release of the Economy Ministry in Berlin, the data dropped 2% from the prior month, when it rose to a revised 2.6%. The reading, which is usually volatile, is incomparable to economists' predictions for a decline of 0.5%. Moreover, orders slid 0.5% from a year earlier. On a yearly period, the index also went down, losing 0.5% against forecast of 0.6% of expansion. Overall, following decrease was provoked by a 4.3% drop in foreign orders, primarily from outside the 19-nations' region, while domestic orders increased by 1.3%. Meanwhile, within foreign demand, new orders from the Euro area surged 2.5% for the previous month, while new orders from other countries slipped 8.3%. Orders for intermediate goods, in turn, added 4.8%, while the manufacturers of capital goods showed a monthly fall of 6.1%. For consumer goods, a decrease in new orders of 1% was registered.
In the meantime, the Bundesbank last week cut its forecast for German growth in 2016 and 2017, simultaneously affirming a robust economic trend as well as strengthening labor market conditions.
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