Industrial orders in Germany fell sharply in
September as demand from the eurozone plunged and the world economy
slowed, data released Tuesday showed.
The data adds to the evidence that German growth is losing
momentum after it managed to weather the economic fallout from the
eurozone debt crisis during the first half of the year.
The Ministry for Economics said factory orders fell 3.3 per cent
in September, adding to signs of a slowdown in Europe's biggest
economy. The decline followed a 0.8-per-cent drop in August.
Analysts had expected the September data to show factory orders
declining by 0.4 per cent.
Releasing the data, the ministry pointed to the weak state of the
17-member eurozone economy and slack global demand as the key factors
behind the fall in orders.
"It is therefore likely that industrial production will continue
to weaken in the coming months," it said.
Year-on-year, order books shrunk by 4.7 per cent during the three
months to end of September when compared with the same period last
year, the ministry said. Orders fell 2.3 per cent in the third
quarter from the second, it said.
Leading the September monthly drop was a 9.6-per-cent fall in
orders from the eurozone, which has been hit by recession and fiscal
austerity.
Orders also fell by 1.5 per cent from nations outside the
eurozone. This resulted in total foreign orders falling by 4.5 per
cent. Total domestic orders declined by 1.8 per cent, the ministry
said.
In line with a series of forecasts by private economists, the
German government last month slashed its growth outlook for next
year.
Berlin now expects the nation's economy to expand by 1 per cent in
2013 - down from its forecast earlier this year of a 1.6-per-cent
expansion rate.
"It is becoming more likely that the German economy will shrink in
the fourth quarter," said Commerzbank economist Ralph Solveen.
The release of the order book data coincided with signs that the
eurozone slipped deeper into recession during October.
The London-based Markit economic research group said its composite
purchasing managers' index (PMI) for the eurozone's manufacturing and
service sectors fell to 45.7 points last month from 46.1 in
September. A reading below 50 indicates contraction.
The fall came after Germany's PMI slumped to a two-month low of
47.7 in October.
"The downturn is still widespread, with all of the big-four
(eurozone) economies seeing output decline in October," said Rob
Dobson, senior economist at Markit.
"Signs that the contraction in Germany gathered pace are
particularly disappointing, given the important role a strong
performing Germany could play in stimulating growth elsewhere in the
currency zone," he said.
