Industrial Orders Rise Despite Decline in Foreign Demand

Summary

  • Industrial orders saw a 0.3% increase month-on-month from last month when adjusted for season and calendar, according to the Federal Statistics Office.
  • Domestic orders rose by 1.4%, while foreign orders fell by 0.4% on the month.
  • In the euro zone, orders fell by 1.9% while orders from the rest of the world saw an increase of 0.6%.
  • New orders revealed a 4.5% decrease over the three months from September to November, as compared to the preceding quarter.
  • Month-on-month industrial orders for October were shown to have declined by 3.8%, a revision from the initial 3.7% drop.
  • Excluding large-scale orders, new orders in November were down by 0.6% compared with October.

Details and Analysis

The Federal Statistics Office announced on Monday that industrial orders marked a rise of 0.3% on a month-to-month basis after being adjusted for the season and calendar. On the domestic front, orders noted a rise of 1.4% while foreign orders fell by 0.4% for the month.

Orders coming in from the Euro Zone underwent a 1.9% decrease, but global orders, excluding Europe, experienced a 0.6% rise.

Comparative Statistics and Trends

When compared to the preceding three months, the less volatile three-months-on-three-months comparison pointed out a drop of 4.5% in new orders in the period from September to November. The Statistics Office also made a revision to the October data, reporting a 3.8% decrease in industrial orders instead of the previously reported 3.7% fall.

New orders, excluding those on a larger scale, were down by 0.6% in November in comparison to October.

Impacts of the Coronavirus Crisis

With companies depleting their backlog of orders, which were left unfulfilled during the coronavirus crisis, they have become incapable of absorbing the weakened demand, noted Joerg Kraemer, Commerzbank’s chief economist. This situation implies a potential further drop in industrial production.

It should be noted that data pertaining to November industrial production is set to be released on Tuesday.

The fluctuation in domestic and foreign industrial orders, as well as shifts observed in the Euro Zone and global order trends, can impact forex markets and trading of assets in sectors dependent on industrial growth.

PIP Penguin
Logo