German Machine Tool Orders Plunge in November

For the first time in nearly two years, orders for machine tools dropped sharply in November. Overall orders for machines used widely to produce other goods plunged 12% in November, the VDMA said on Jan. 12.

Domestic orders were down by 2% while exports dropped by as much as 17%.

"Orders were down for the first time since January 2010. This is no surprise, since foreign orders had been particularly strong a year earlier," said VDMA chief economist Ralph Wiechers. "We cannot talk of a slump at this stage. It's just a normal cyclical downturn."

"In addition, the weakening is not due to slumping orders in the euro area but to fewer orders from other regions outside Europe."

In the three months from September through November, machine tool orders were down by 4% overall, with domestic orders stagnating and foreign orders falling 6%.

German machine tools are a key product for the world's second biggest exporter after China and serve as a key leading indicator of economic activity.

Copyright Agence France-Presse, 2011