ALBAWABA – German factory orders dropped unexpectedly in April, indicating dimmed prospects for Europe’s largest economy, according to Bloomberg.
Demand decreased 0.4 percent from March, though Bloomberg economists expected a 2.8 percent decrease.
The decline was driven by a drop in large-scale orders. Excluding them, the German factory orders index would jump 1.4 percent, Bloomberg claimed.
Overall, the country’s gross domestic product (GDP) fell in the six month to March, even though the New York-based news outlet said that Germany was in fact able to avoid “the bleakest scenarios invoked after Russia’s invasion of Ukraine”.
Factories have been relying on a large backlog of work to sustain production as new orders fall.
Surveys of purchasing managers revealed that conditions in the sector deteriorated in May as exports plunged, Bloomberg reported.
Tighter monetary policy to fight inflation is also curbing demand.
Bloomberg estimates that the European Central Bank is planning to raise borrowing costs further to get prices under control.
