German Jan industry orders post biggest fall in eight years
- Author: Zachary Reyes Mar 08, 2017,
Mar 08, 2017, 16:08
That was the biggest monthly drop since January 2009 and was nearly three times below the Reuters consensus forecast for a fall of 2.5 percent. The typically volatile reading compares with a median estimate for a 2.5 percent decline in a Bloomberg survey.
"No panic: orders do not determine the short-term economic development and the early indicators are brilliant - it should continue uphill", Andreas Scheuerle of Deka Bank wrote in a note to clients.
On a yearly basis, industrial output remained flat in January after easing 0.1 percent in December. Domestic demand fell by 10.5 percent and foreign orders by 4.9 percent.
Capital goods production advanced 6.1 percent and output of consumer goods rose 2.3 percent.
Markets appeared to shrug off the data.
The euro was little changed and traded at $1.0596 at 8:41 a.m. Frankfurt time. Heightened uncertainty following Brexit and Trump's protectionist policies have likely taken its toll. Production was forecast to drop 0.6 percent in January.
Economists had penciled in a rise of 2.7%. There will also be fewer working days this year than last.
However, figures released on 7 March referencing the month of February revealed a notable - and wholly unexpected - slowdown in orders for capital goods. The German government for its part refused to overrate the slump in industrial orders. "They expect a revival of exports", said Sophia Krietenbrink of the DIHK Chambers of Industry and Commerce.
"The upward trend in the German manufacturing sector remains intact", Strobel wrote in a note to clients.