German manufacturing orders enjoy unexpected upswing in September
Economists cheered by figures that break a long downturn in factory activity
German manufacturers enjoyed an unexpectedly buoyant September, with significant hikes in both domestic and foreign orders.
Figures from the Federal Statistics Office showed that new manufacturing orders rose by 1.3 per cent compared to August, offering hope that Europe’s largest economy may finally be emerging from a prolonged sluggish spell. Analysts polled by Reuters had predicted just a 0.1 per cent rise.
The rise reflects a 1.6 per cent increase in domestic orders, and a 1.1 per cent jump in orders from overseas.
Germany is a heavily export-dependent economy, with one in three jobs in the country relying on foreign sales. That has made it especially vulnerable to prolonged trade disputes and global uncertainty, including Brexit and the China-US trade war. In the summer, the DIHK Chambers of Industry and Commerce more than halved its export growth forecast for the year to 1 per cent from 2.5 per cent.
The results have slightly eased fears that Germany may slide into a technical recession (two straight quarters of contraction), though that remains a possibility. Experts have reacted to the results with cautious optimism, with the German Business Ministry saying the numbers - combined with brightening business expectations - could represent “a bottoming out of orders.”