German industrial orders surprise with October boost

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AFP/File / PATRIK STOLLARZ Both domestic and foreign demand for German goods contributed to an October increase in orders, with 0.4-percent growth at home and 0.5-percent expansion abroad

Industrial firms in Germany beat analysts’ expectations by reporting slightly increased orders in October, official data showed Wednesday, suggesting a run of strong growth has further to go before petering out.

New contracts — seen as an indicator of future growth in Europe’s largest economy — added 0.5 percent month-on-month, figures from federal statistics authority Destatis showed, where analysts surveyed by Factset had predicted a slight decrease.

The statisticians also revised the previous month’s growth in orders up slightly, to 1.2 percent.

Both domestic and foreign demand for German goods contributed to the October increase, with 0.4-percent growth in orders at home and 0.5-percent expansion abroad.

But new contracts from Germany’s neighbours in the 19-nation eurozone fell by 1.2 percent, while demand from the rest of the world increased 1.6 percent.

Manufacturers of capital and consumer goods both saw increased orders, but producer goods makers reported falling demand.

“Ordering activity increased for the third time in a month in October, overall a very active development,” the economy ministry in Berlin commented in a statement.

A two-month comparison of September and October versus July and August — which the ministry argues is more representative of underlying trends — showed growth in orders of 3.4 percent.

Surveys among German business leaders show confidence at an all-time high, with economic growth powered by domestic consumption, a construction boom and growth in investments, while foreign demand for the nation’s goods remains unslaked.

Combined with those factors, Wednesday’s results mean “the business cycle in industry should remain on a strong upward trend,” the ministry predicted.