Germany's industry got off to a surprisingly weak start in January, with orders falling more than forecast and output unexpectedly decreasing, according to statistics office data.
January orders declined by 11.1 per cent compared with the previous month on a seasonally and calendar adjusted basis, putting an end to four consecutive increases, the office said yesterday.
A Reuters poll of analysts had pointed to a fall of 4.5pc.
However, when large-scale orders were excluded, the fall was only 0.4pc in January, said the office, after German industrial orders posted their biggest increase in two years in December.
Despite the volatility, analysts stuck with their positive expectations for the year, barring a sustained escalation in the war in Iran and resulting high oil prices.
“These figures are not for the faint of heart,” said LBBW economist Jens-Oliver Niklasch.
“Overall, however, we continue to maintain our expectation that the economic figures for the current year will be better than last year,” he added.
Union Investment’s Michael Herzum attributed the robust order situation to the German government’s investment in defence and infrastructure.
“Industry should transform from a drag on growth to an engine of growth by 2026, assuming the war with Iran does not escalate permanently,” he said.
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