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German factory orders fell more sharply than expected in October amid dampened demand in foreign markets, official data showed Wednesday, adding to a persistently gloomy picture for Europe’s biggest economy.
New orders, a key indicator closely watched as a sign of future business activity, were down by 3.7%t from a month ago, federal data agency Destatis said.
The figure, much worse than the drop of just 0.25% predicted by analysts, pours cold water on hopes of a reprieve after orders rose slightly in September.
Orders from within Germany rose by 2.4% but those from abroad plunged by 7.6%, today’s figures show.
“Incoming orders continued their downward trend with another significant decline in October,” the economy ministry said in a statement, noting that the “volatility of large orders” had been a particular problem.
If large orders are factored out, figures have been flat since the spring, the ministry said.
Excluding large contracts, orders grew by 0.7% in October.
The German economy has struggled to find its way out of a downturn in recent months as it battles headwinds including the fallout from Russia’s war in Ukraine, high inflation and weaker demand from key market China.
The government expects output to contract by 0.4% this year and the International Monetary Fund believes Germany will be the only major advanced economy to contract in 2023.
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