FRANKFURT, Germany — German industrial firms recorded a sharp uptick in orders in August, official data showed on Thursday, outdoing analyst forecasts and reducing fears of an autumn slowdown in Europe’s biggest economy.
Firms saw a 1.0% increase in their order books in August compared with July, correcting for price, seasonal and calendar effects, the federal statistics office Destatis said. Analysts surveyed by Factset had predicted significantly weaker growth of 0.4%.
Demand for German products grew at home, with domestic orders up 2.6% in August versus the previous month. But the picture was mixed abroad, with a strong increase in orders from fellow Eurozone countries at 4.1% offset by a 2.8% slide in non-Eurozone orders.
Overall, orders from outside Germany fell back by 0.2 percent. Ruling out large contracts, which can distort the figures, orders were up overall by 1.6 percent.
“New orders remain modest in the current year,” the economy ministry said in a statement.
But officials pointed to improved business sentiment and an increase in the purchasing managers’ index in September as signs of “a slight revival of industrial activity in the remainder of the year.”
“Today’s numbers bring some relief for German industry, but are still far too little to become overly optimistic,” analyst Carsten Brzeski at ING Diba bank said, pointing to overall weak growth in new orders since last winter. “Unless we see an entire series of similar data in the coming months, German industry will have trouble shifting to a higher gear.”
Destatis revised its industrial orders figure for July upwards slightly on Thursday, recording growth of 0.3% from an initial reading of 0.2%.
Copyright Agence France-Presse, 2016