Unexpected orders blow for German industry

7th September 2010, Comments 0 comments

European powerhouse Germany received a blow Tuesday as orders for its industrial goods unexpectedly dropped significantly in July, following a strong rise the month before, official data showed.

Industrial orders fell by 2.2 percent on the month, figures from the economy ministry showed, following an upwardly revised gain of 3.6 percent the previous month.

The data wrongfooted analysts surveyed by Dow Jones Newswires, who had forecast a gain of 0.4 percent.

"The result for the current month was depressed by significantly below-average large orders," the ministry said in a statement.

However, taking the months of June and July together, which gives a better idea of the trend, industrial orders in Germany rose by 2.4 percent.

Germany, the world's second largest exporter, has bounced back from a crippling recession in 2009 to register record growth in the second three months of the year, driven by increased demand for its goods around the world.

Berlin is expected to raise its forecast for output growth this year to around 3.0 percent, up from a previous estimate of 1.4 percent, according to media reports.

Despite the recession, unemployment in the country remained relatively low at 7.6 percent of the workforce in August, with some 3.2 million people out of work.

Industry leaders are increasingly optimistic about the future as well, with business confidence levels rising to where they were before the financial market crisis.

© 2010 AFP

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