German factory orders pick up in April
German factory orders picked up in April, according to figures released by Destatis on Thursday.
Orders were up 0.3% on the month versus expectations for no change, and down 5.3% from the year before compared to expectations for a 7.2% decline.
In March, factory orders had risen 0.8% on the month and fallen 5.9% compared to the same month the year earlier.
Domestic orders fell 0.8%, while foreign orders rose by 1.1% in April on the previous month. New orders from the eurozone were down 5.8% and new orders from other countries rose 5.7% compared to March.
The manufacturers of intermediate goods saw new orders fall by 0.4% on the month, while the manufacturers of capital goods showed increases of 0.9% on the previous month. For consumer goods, an increase in new orders of 0.1% was recorded.
Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics, said there is stabilisation in the month-on-month data but the trend still points to slower output growth.
"The collapse at the start of the year has given way to signs of stabilisation but the dreadful year-over-year rate, and the fact that the level of new orders remain some 4-to-5% below their level at the end of 2018 continue to tell a story overall sluggish growth.
"The headline was lifted mainly by a 0.9% month-to-month increase in capital goods orders, but modest gains in new orders for consumer and intermediate goods also helped.
"Looking ahead, the survey data point to still-soft demand conditions, threatening both new orders and production in Q2. In addition, the Q1 plunge in new orders is almost surely not yet reflected in the production data, which we fear will worsen quite a bit in coming months, starting with tomorrow’s report for April."
ING analyst Carsten Brzeski said today's strong numbers only marginally offset the losses of the first months.
"German industry is still suffering from global uncertainty on the back of trade conflicts. Since last summer foreign orders have dropped by a monthly average of 0.6%. At the same time, however, domestic demand has also weakened, particularly since the start of the year.
"While domestic new orders remained stable in the second half of 2018, they collapsed in the first quarter, dropping by a total of 7% between January and March."