HomeContributorsFundamental AnalysisGermany Factory Orders Rebound Sharply In December

Germany Factory Orders Rebound Sharply In December

‘All recent data point to a very strong start for 2017 in Germany and in the euro area after a very good fourth quarter’. – Julian Trahorsch, Landesbank Baden-Wuerttemberg

Germany factory orders rose markedly in the last month of 2016, driven by a sharp increase in demand for investment goods, official figures revealed on Monday. According to the Economy Ministry, German industrial orders advanced at seasonally adjusted rate of 5.2% in December, following the preceding month’s downwardly revised fall of 3.6% and surpassing market analysts’ expectations for an increase of 0.6%. The December pace was the strongest since July 2014. On an annual basis, factory orders grew 8.1% in December. Monday’s data provided evidence that economic growth accelerated in the final quarter of 2016 after climbing just 0.2% in the Q3 of 2016. The Q4 2017 GDP data is scheduled to be released on February 2014. The majority of analysts suggest the economy expanded at a 0.5% pace during the Q4. However, their long-term forecasts are less optimistic in large due to the upcoming German federal elections. Yesterday’s data also showed export orders climbed 10% month-over-month in December, driven by a 19.5% increase in demand for capital goods from the Euro zone. Meanwhile, domestic orders advanced 6.7% during the same period. On a quarterly basis, factory orders grew 4.3% in the Q4. After the release, the Euro extended its losses, falling to 1.0746 against the US Dollar.

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