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Impending recession: Orders for German industry drop significantly

2019-09-05T08:10:30.861Z

Germany's industry must cope with significant losses in new business at the beginning of the second half of the year. The risk of a recession increases as a result.




Industrial companies in Germany have to accept an unexpectedly sharp drop in orders in July. According to the Federal Ministry of Economics, new business fell by 2.7 percent compared to the previous month.

Domestic orders decreased by 0.5 percent. Demand from the rest of the world, along with the world's largest economies, the US and China, even fell 6.7 percent. By contrast, orders from the euro zone rose by 0.3 percent.

According to experts, the industry is mainly the global trade conflicts, the approaching EU farewell to Britain and the flagging auto industry to create.

The weakness of new orders also weighs on the growth of the entire German economy. The recession probability has increased significantly, said economist Thomas Ginzel of VP Bank.

The prospects for the coming months are also bad, according to the Ministry of Economic Affairs. "Given the ongoing smoldering international trade conflicts and restrained business expectations in the manufacturing sector, there is still no fundamental improvement in the industrial economy," the ministry said.

In June, there had been a 2.7 percent increase in industrial orders, but only due to unusually large orders. These were below average this time.

Source: spiegel

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