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BCN-26
GERMANY-ECONOMY-INDUSTRY
German industrial orders plunge in June
FRANKFURT AM MAIN, Aug 6, 2018 (BSS/AFP) – Industrial orders in Germany
fell more than expected June, official data showed Tuesday, as global trade
tensions weighed on Europe’s top economy.
New contracts at industrial firms plunged four percent month-on-month,
federal statistics authority Destatis said in figures adjusted for seasonal
swings, following a 2.6 percent increase in May.
Analysts surveyed by Factset had predicted a far smaller drop of 0.25
percent in June.
Analyst Carsten Brzeski from ING Diba bank described the June reading as a
“cold summer shower”.
“Disappointing new orders data show tentative signs of trade tensions
hitting the German economy, which doesn’t bode well for the industrial
outlook in the second half of the year,” he said.
The June slump was led by orders from outside the eurozone, which were
down nearly six percent.
Orders within Germany and the euro area fell nearly three percent.
The economy ministry in Berlin said that with the exception of the May
rebound, order intakes had been “weak” so far this year.
“Uncertainty caused by trade policies may have played a role,” it said in
a statement.
Companies around the world are nervously eyeing a deepening trade war
between the United States and China, spurred by President Donald Trump’s
“America First” agenda.
Trade relations between the US and the European Union are also tense after
Trump imposed tariffs on metals imports, prompting retaliatory EU duties.
Trump has also threatened to slap hefty tariffs on foreign cars, which
would badly hurt German auto makers.
Looking ahead, the German economy ministry was nevertheless optimistic
about the second half of the year.
“The order backlog remains high and despite the cloudy spell, the business
climate is clearly still positive.”
BSS/AFP/HR/1315