GERMAN factory orders rose slightly in September, buoyed by stronger foreign demand, official data showed today, in a glimmer of good news for Europe’s biggest economy as it battles a slowdown.

New orders, a key indicator closely watched as a sign of future business activity, were up 0.2% from a month ago, federal data agency Destatis said.

Analysts surveyed by financial data firm FactSet had predicted a substantial drop of 1.3%.

The positive data followed a big rise of 1.9% in August – a figure that was revised significantly downwards from a previous estimate due to errors in data provided by some sectors.

Foreign demand and in particular large orders had lifted September’s numbers, said the economy ministry in a statement, with orders from abroad rising 4.2%.

If large orders were stripped out, September’s overall industrial figures would have dropped 2.2% on the month, added the ministry.

Domestic orders meanwhile slumped 5.9%.

High inflation, elevated energy costs and weaker demand from key market China have all been weighing on Germany’s crucial manufacturing sector in recent months.

Germany tipped into a recession at the start of the year, and economic growth stagnated in the second quarter. A slew of weak indicators since then have added to fears of a prolonged slowdown.

The International Monetary Fund has predicted that Germany will be the only major advanced economy to shrink this year. – AFP, November 6, 2023.