German industrial orders fall more than expected in July

German industrial orders fell more than expected in July, pulling back after a sharp gain in the aerospace sector the previous month, the federal statistics office said on Wednesday.

Incoming orders fell by 11.7 per cent on the previous month on a seasonally and calendar adjusted basis.

A Reuters poll of analysts had pointed to a drop of 4.0 per cent.

“The big fluctuations in new orders seen in the past months therefore continued to be observed in July 2023,” said the office, which added that July’s sharp decline was due to a very large order in air and spacecraft manufacturing the month before.

Orders had posted an unexpected jump in June, rising by a revised 7.6 per cent month-on-month, versus expectations of a 2.0 per cent dip.

Analysts pointed to weakness in the global economy as a reason for the trend.

“Germany is at the mercy of the global economy – the latter is not in good shape at present,” said Thomas Gitzel of VP Bank Group. “It is therefore not surprising that the underlying order intake is weak.”

Alexander Krueger, chief economist at Hauck Aufhaeuser Lampe Privatbank, added: “The thumb continues to point downward for the industrial sector. A turnaround is not in sight due to the weak global economy and high energy costs.”

Excluding large-scale orders, industrial orders would have increased by 0.3 per cent in July. In the less volatile three-month comparison, order intake from May to July was 3.1 per cent higher than in the previous three months.

The statistics office publishes more economic data on its website.