Business
17:02, 06-Oct-2017
German industrial orders jump thanks to vibrant demand from abroad
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Data released on Friday shows that German industrial orders bounced back in August, rising more than expected due to strong foreign demand, suggesting that factories will contribute to the overall growth of Europe’s largest economy in coming months.
Industrial companies registered a 3.6 percent increase in orders after contracts for "Made in Germany" goods fell by an upwardly revised 0.4 percent in July, data from the Economy Ministry showed.
The data for August had the strongest monthly increase since December, easily beating the Reuters forecast for a 0.7 percent rise, surpassing even the most optimistic estimate.
A data breakdown showed domestic demand rose 2.7 percent while foreign orders jumped 4.3 percent, propelled by a 7.7 percent increase from customers outside the euro zone, despite the recent appreciation of the single currency.
German industrial orders bounced back in August, rising more than expected on strong foreign demand. /Reuters Photo
German industrial orders bounced back in August, rising more than expected on strong foreign demand. /Reuters Photo
"Orders activity further picked up recently from an already high level," the ministry said, adding that the positive trend was backed by good business morale and strong output figures.
"The solid upturn in the manufacturing sector should therefore continue," it added.
ING Bank chief economist Carsten Brzeski said the "summer explosion in new orders" was likely the result of some bulk orders. Nevertheless, the strong August figure suddenly made 2017 a strong year for new orders, Brzeski said.
"Combined with strong business surveys, showing production expectations as well as order books close to record highs, the German industry looks all set to end the year at maximum speed."
The German economy grew 0.7 percent on the quarter in the first three months of the year and 0.6 percent from April to June, driven by increased household and state spending as well as higher investment in buildings and machinery. /Reuters Photo
The German economy grew 0.7 percent on the quarter in the first three months of the year and 0.6 percent from April to June, driven by increased household and state spending as well as higher investment in buildings and machinery. /Reuters Photo
The German economy grew 0.7 percent in the first three months of the year and 0.6 percent from April to June, driven by increased household and state spending as well as higher investment in buildings and machinery.
Leading economic institutes last week raised their growth forecast for the German economy to 1.9 percent in 2017 and 2.0 percent in 2018. This would translate into calendar-adjusted GDP rates of 2.2 percent and 2.1 percent respectively.
The German government will present its updated projections for GDP growth, employment and inflation on Wednesday.
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Source(s): AFP
,Reuters