Germany: "Economic situation better than thought" - industry surprises with strong order increase
German industrial orders grow by 3.1 percent in June - more than ten times as much as expected. Mechanical engineering and electronics manufacturers in particular report large orders.
The German industry received many orders unexpectedly in June, with new business growing by 3.1 percent compared to the previous month, the Federal Statistical Office announced on Thursday. Economists polled by the news agency Reuters had only anticipated a plus of 0.3 percent. This marks the second consecutive increase: In May, there was already a revised plus of 0.3 percent, which was significantly smaller than the initially estimated 1.9 percent.
"The strong order intake lays the foundation for medium-term production expansion," said Thomas Gitzel, chief economist at VP Bank. "The German economy has thus completed the trend reversal and is expected to display higher growth figures in the coming years." Oil prices and low water dampen euphoria "Overall, the economic outlook appears somewhat better than what we thought just recently," Jens-Oliver Niklasch, an economist at Landesbank Baden-Württemberg (LBBW), said.
"However, the oil price risk hangs over everything, and with the levels of the large rivers, a new downside risk has emerged."
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