German industrial orders drop in Sept as foreign demand dives

Reuters

Published Nov 04, 2022 03:31AM ET

Updated Nov 04, 2022 04:56AM ET

BERLIN (Reuters) - German industrial orders fell by more than expected in September as foreign demand slumped, putting Europe's largest economy on course for recession, data showed on Friday.

New orders fell by 4.0% on the month on a seasonally and calendar adjusted basis, the Federal Statistics Office said. A Reuters poll of analysts had pointed to a fall of 0.5% in September.

Germany staved off the threat of recession in the third quarter with unexpected growth, but the economy remained in choppy waters as high inflation driven by a painful energy standoff with Russia surged, data showed last Friday.

The orders data underlined the headwinds Germany is facing as the sluggish global economy, materials shortages and the energy crisis hamper production.

"The German economy is on course for recession - that much can be deduced from the disastrous new orders," said Thomas Gitzel, chief economist VP Bank.

While domestic orders increased by 0.5%, foreign orders plunged by 7.0%. Within the euro zone, orders were down 8.0% while orders from outside the euro zone dropped 6.3%.