(AFP / RALF HIRSCHBERGER)
German industrial orders experienced a sharp decline in April, according to provisional results published Monday by the Destatis institute, and the government does not expect an improvement due to the conflict in the Middle East.
Over one month, the volume of orders fell by 3.8% in data adjusted for seasonal variations and calendar effects. Year-on-year, orders increased by 1.6%.
In the current context of the Middle East, synonymous with “rising costs and uncertainties and growing tensions on supply chains, the industrial situation should only continue to recover moderately in the coming months”, warns the Ministry of the Economy in a separate press release.
The geographical origin of orders shows a real gap between customers in the euro zone, who have significantly reduced their orders (-11.1%), while the other countries have not closed their books (+0.8%), according to Destatis.
The automotive and spare parts sectors (-5.3%), machinery (-7.4%), electrical equipment (-16.3%) are suffering the most from the current context.
In March, orders experienced a jump of 4.5% (5% in provisional value), with the Ministry of the Economy explaining this by “anticipation effects” linked to the energy crisis caused by the war in Iran.
But “the rise in the prices of energy and raw materials” and a “significantly increased geopolitical uncertainty” seem to increasingly lead to “a drop in demand, in particular for capital goods”, the ministry commented on Monday.
In a more stable quarterly comparison, new orders fell by 3.1% compared to the previous quarter, after abnormally high activity at the end of last year.
“Until the start of the conflict in the Middle East (…), the trend was upward,” underlines the ministry.
