Orders from German factories in March fell the most since the beginning of the coronavirus pandemic in 2020, according to preliminary data from the statistical office Destatis. Real new factory orders in March decreased by 10.7 percent compared to February, when they were revised up by 4.5 percent, according to Destatis’s report.
On an annual basis, they decreased by 11 percent, following a decline of six percent in February. Excluding large orders, the monthly decline in March was 7.7 percent.
Foreign orders fell by 13.3 percent compared to the previous month, while domestic orders decreased by 6.8 percent. Orders for the construction of ships, aircraft, and spacecraft plummeted by 47.4 percent compared to February, when they had strongly surged by 55 percent on a monthly basis.
The motor vehicles and auto parts segment also significantly impacted the order data in March, with a decline in orders of 12.2 percent compared to the previous month.
New orders in the capital goods industry fell by 14.1 percent on a monthly basis, while in the intermediate goods segment, they decreased by 7.5 percent. On the other hand, orders for consumer goods increased by 1.2 percent.
In the first quarter of 2023, new orders were 0.2 percent higher than in the same period last year.
Furthermore, the data showed that industrial turnover decreased by 2.9 percent compared to February, when it was revised up by 1.5 percent. On an annual basis, it increased by 3.7 percent.
Germany avoided recession as the economy stagnated in the first quarter, given that the decline in household and government consumption neutralized improvements in capital formation and exports. In the fourth quarter of last year, the economy fell by 0.5 percent compared to the previous three months.
The International Monetary Fund (IMF) predicts that the German economy will decline by 0.1 percent this year and grow by 1.1 percent next year.
