In a rare instance of positive news for Europe’s largest economy as it struggles with an industrial slowdown, official statistics released on Friday indicated that German factory orders increased more than expected in August.
After a dramatic decline of 11.3 percent in July, new orders increased by 3.9 percent month over month, according to the federal statistics agency Destatis.
A lesser increase of 1.5 percent was what analysts polled by FactSet had predicted.
Destatis said the increase was driven by a nearly 38-percent jump in demand for “computer, electronic and optical products”, while orders in the automotive industry dipped by 0.7 percent.
The economy ministry said that while factory orders had been “volatile” lately, there were signs the country’s industrial slump “may have bottomed out in the third quarter”.
“A gradual economic recovery should then begin at the turn of the year,” the ministry said in a statement.
High inflation, elevated energy costs and weaker demand from key market China have all been weighing on Germany’s crucial manufacturing sector in recent months.
Germany entered a recession at the beginning of 2023, and second-quarter economic growth stalled. Since then, a number of unfavorable signs have increased concerns about a protracted recession.
The only other significant advanced economy expected to contract this year is Germany, according to the International Monetary Fund.
Leading economic research institutions in Germany predicted last week that the GDP will decline by 0.6 percent in 2023.
