The production line at Germany AG turned more slowly in December, data showed, echoing other indicators that the German economy is slowing down (THOMAS KIENZLE)

Frankfurt am Main (AFP) – Industrial orders in Germany fell back in December, official data showed Wednesday, in the latest sign of slowdown in Europe’s largest economy.

Orders were down 1.6 percent month-on-month, federal statistics authority Destatis said in seasonally- and calendar-adjusted figures.

But there was some brighter news in the data as well. Excluding volatile large orders for items like aircraft there was a 3.5 percent increase in new business.

Looking to different industrial sectors, both producer goods and capital goods makers reported falling contracts, dropping by 1.2 and 2.5 percent respectively.

But consumer goods firms booked a rebound after two successive monthly falls, gaining 4.2 percent.

Demand from abroad fell 2.3 percent, although eurozone orders partially rebounded from a sharp fall in November while new contracts from the rest of the world shrank.

And domestic orders fell back only slightly, by 0.6 percent.

In a statement, the economy ministry in Berlin noted that orders increased 0.3 percent over the whole final quarter of 2018.

All the growth came from capital goods makers as the car industry overcame bottlenecks in the EU-wide WLTP emissions testing cycle, which came into force in September.

Nevertheless, “the fall in orders in December points to a continued lean period in industry,” the ministry said.

“The latest sentiment indicators also signal weaker industrial activity at the start of the year.”

ING Diba bank economist Carsten Brzeski argued that “the sharp increase in new orders from other eurozone countries as well as the data corrected for bulk orders show that not everything is so depressing for German industry.”

However, “any rebound of industrial activity in Germany will be slow and sluggish,” he predicted.

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