German industrial orders fall more than expected in August

Reuters

Published Oct 06, 2021 02:16AM ET

Updated Oct 06, 2021 03:17AM ET

BERLIN (Reuters) -German industrial orders fell more than expected in August on weaker demand from abroad following two months of unusually strong gains due to major contracts, data showed on Wednesday.

The figures published by the Federal Statistics Office showed orders for goods 'Made in Germany' were down by 7.7% on the month in seasonally adjusted terms. A Reuters poll of analysts had pointed to a drop of 2.1% on the month.

German car companies are struggling to meet a post-pandemic surge in demand since the start of the year due to a lack of microchips and other intermediate products which is holding back the recovery of Europe's largest economy.

The steep drop on the month was partly caused by previous orders for planes, ships and other large vehicles which had pushed up orders by 4.9% in July and 4.6% in June, the office said.

Without this distorting effect, industrial orders were down by 5.1% in August.

Another reason for the weaker-than-expected headline figure was lower demand from abroad, especially from clients outside the euro zone area.

The economy ministry also pointed to an unusually strong decline in orders for cars which it partly linked to special holiday effects in some regions with large automobile factories.

Nonetheless, overall industrial orders remained at a historically high level and were already 8.5% above their pre-crisis levels of February 2020, the month before Germany was hit by the COVID-19 pandemic, the ministry said.

"The result is a shock at first glance, but given the overall high level, it hurts less than in normal times," Bankhaus Lampe economist Alexander Krueger said.