German industrial orders mark strong rise in Dec

FE Team | Published: February 07, 2018 01:05:02

FRANKFURT AM MAIN, Feb 06 (AFP): Industrial orders in Germany rose strongly in December, data showed on Tuesday, underlining the strength of the recovery in Europe's biggest economy, analysts said.
After dipping in November, industrial orders increased by 3.8 percent month-on-month in December, federal statistics authority Destatis calculated in seasonal and calendar adjusted data.
Analysts had been pencilling a more modest rise of 0.7 per cent.
Much of the increase was accounted for by more volatile big-ticket items, such as aircraft orders. Adjusted for those, overall orders were up by a more modest 0.8 per cent, Destatis said.
And the increase was also driven primarily by foreign demand for German-made goods, with domestic orders edging only slightly higher, the data showed.
The data provided "further evidence of the strong industrial recovery" in Germany, said ING Diba bank analyst Carsten Brzeski.
"With inventories low and capacity utilisation at its highest level since 2008, industrial production should start the new year exactly as it ended the last year: on a strong footing," the expert said.
German industrial production data are slated for release on Wednesday.
Meanwhile, almost one million workers at Germany's powerful metalworking union IG Metall have won the right to a reduced working week in an agreement with employers late Monday, potentially staving off the threat of fresh strikes after a week of walkouts.
IG Metall is negotiating on behalf of around 3.9 million workers in a critical sector for Europe's largest economy, pushing for higher pay and the right to temporarily switch to part-time hours.
Around half a million workers drawn from sectors as varied as carmaking, electrical and electronic goods or metal production downed tools last week in 24-hour "warning strikes" as talks made little headway.
Union bosses threatened an indefinite strike if their demands were not met, something that has not occurred in the sector since 2003.
But in an overnight statement, both the union and employers announced that they had reached a "tolerable compromise" with some "painful elements" in the key industrial state of Baden-Wuerttemberg.
Some 900,000 workers are covered by the agreement, which could be extended to all of Germany.