German Manufacturing Orders Surprise with December Jump

by webmaster

German manufacturing orders saw an unexpected increase in December, primarily driven by high volumes of aircraft purchases. However, when excluding larger orders, overall orders still showed a decline, reflecting the challenging environment faced by the sector.

According to the German statistics office Destatis, orders in December were 8.9% higher compared to the previous month. This figure contrasts with the consensus among economists, who anticipated a 0.5% decrease in orders, as reported by The Wall Street Journal.

This surge in orders effectively offsets several consecutive months of losses, including a 4% decline in October and an 11% downturn in July. Those previous declines were widely regarded as indicators of a manufacturing slump in Germany. In comparison to the same month the previous year, December’s orders were 2.7% higher.

However, it is important to note that these order numbers were significantly influenced by large-scale purchases, particularly in the aircraft sector. Destatis suggests that the notable increase in orders was likely driven by extensive orders placed with aircraft manufacturer Airbus, which received a remarkable total of 807 orders during the month.

In terms of specific industries, orders for aircraft, ships, and trains more than doubled in December compared to November. Additionally, there was a notable increase in orders for metal products and electrical equipment, both experiencing double-digit percentage growth.

Conversely, the automotive industry in Germany encountered a 15% drop in orders during this period. Mechanical engineering and the chemical industry also experienced declines. When excluding major purchases, overall orders decreased by 2.2% compared to the previous month.

Overall, these order figures exemplify Germany’s continuing struggles within its manufacturing base. Throughout 2023, orders were 5.9% lower compared to the previous year, according to Destatis. This decline can be attributed to a global decrease in demand and constrained financing conditions.

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