- German industry records more orders for the first time in 2024
Bright Spot for Struggling German Industry: In June, the sector received more orders for the first time this year. The order intake increased by 3.9 percent compared to the previous month, the Federal Statistical Office reported. Previously, the order intake in industrial enterprises had declined for five consecutive months.
Analysts had expected a recovery in order intake, but they had forecast a much smaller increase of 0.5 percent on average. Compared to the previous year, significantly fewer new orders were recorded. In this comparison, the office reported a decrease of 11.8 percent. Without large orders, overall orders would have increased by 3.3 percent compared to the previous month.
Increased Domestic Demand
The increase in June was mainly driven by a significantly stronger domestic demand. According to the Federal Ministry of Economics, orders here increased strongly by 9.1 percent. The demand from abroad also developed better but could only increase slightly by 0.4 percent.
Orders in the important sectors of mechanical engineering, automotive and automotive parts, metal products, and other vehicle manufacturing increased significantly, as reported by the ministry. However, orders in the areas of metal production and processing and in the pharmaceutical industry decreased.
"Downward Trend Not Broken"
The latest development of domestic orders, together with recent survey results from the European Central Bank (ECB), could indicate "increased investment intentions and a recovery in capital investment in the second half of the year," experts from the ministry commented. "However, a broader revival of the industrial economy is not likely at present, given the still subdued business sentiment and weak foreign demand."
"There are still good news," said Jens-Oliver Niklasch, analyst at Landesbank Baden-Württemberg. "But more needs to come to really boost confidence in the industry. The downward trend is not broken yet."
The sector's improvement in June, with orders from Germany increasing by 9.1%, is a positive sign for the struggling German industry. Despite this, analyst Jens-Oliver Niklasch notes that the downward trend has not been fully reversed yet, indicating more is needed to boost industry confidence.
