News ID: 114692
Publish Date : 05 May 2023 - 23:08

German Factory Orders Plummet, Raising Risk of Recession

BERLIN (Bloomberg) - German factory orders fell the most since the pandemic as manufacturing continued to fare worse than other parts of Europe’s largest economy.
Demand declined 10.7% in March, more than estimated by a single economist in a Bloomberg poll that predicted a 2.3% drop. The slump was particularly pronounced in the car and car parts industry.
The setback was suffered due to weaker demand from key markets in the EU, U.S. and China.
Exports to the EU states fell by 6.2% while those to China fell by 9.3%.
The United States remained a top consumer by importing €‎12.5 billion worth of German goods in March, representing a dip of 10.9% from last month.
Countries outside the EU imported 4% less from Germany.
Germany posted official data on Friday, which reflected stagnated growth in the first quarter, despite expectations for a slight rebound.
The global economy is “not running smoothly,” and export-heavy Germany is “feeling the effects of this,” Thomas Gitzel, the chief economist of VP Bank, told Reuters news agency.
Analysts have warned that an economic slowdown in the US could hurt Europe’s biggest economy.
“High inflation rates, rising interest rates and the geopolitical uncertainties that have grown with the war in Ukraine are affecting the investment mood of companies,” he said.
However, Alexander Kruger, the chief economist at the Hauck Aufhauser Lampe Privatbank, told Reuters that Berlin’s setback is manageable.
“Export levels are high, material shortages are decreasing and export expectations are improving,” he said.