German Factory Orders Unexpectedly Climb For Third Month On Foreign Demand

Germany’s manufacturing orders increased for a third straight month in October, defying expectations for a decline, led by strong foreign demand despite the global trade uncertainties.

Factory orders grew 0.3 percent from September, preliminary data from the Federal Statistical Office showed on Thursday, while economists’ had forecast a 0.4 percent fall.

September’s 0.3 percent gain was revised to a 0.1 percent increase. Orders rose 2.3 percent in August.

Though the negative impact of the WLTP emissions test implementation in the automotive industry is still clearly noticeable at the start of the fourth quarter, the progress is recognizable, the Economy Ministry said.

“Incoming orders in the automotive industry have picked up noticeably since their low point in July, and the registration backlog has gradually dissolved,” the ministry added.

Domestic orders fell 3.2 percent, while foreign bookings grew 2.9 percent. Demand from Eurozone increased 7.3 percent and orders from others countries rose 0.3 percent.

Meanwhile, the latest purchasing managers’ survey showed that manufacturing growth fell to a 31-month low in November as new orders fell for a second straight month and at the fastest pace in four years.

The survey found that overall export sales decreased for a third straight month, and to the greatest extent since June 2013, with several firms reporting a drop in orders from China.

On a year-on-year basis, factory orders declined 2.7 percent in October, official figures showed, which was less severe fall than the 3.1 percent slump economists had predicted.

The pace of decrease for September was revised to 2.6 percent from 2.2 percent.

Manufacturing turnover grew a seasonally adjusted 1 percent month-on-month in October. September’s decline was revised to 1 percent from 1.1 percent.

Elsewhere on Thursday, survey data from IHS Markit showed that the German construction sector returned to growth in November amid the fastest increase i new orders in nine months.

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