DE: Manufacturers' Orders

Fri Jun 05 01:00:00 CDT 2015

Consensus Actual Previous Revised
Month over Month 1.0% 1.4% 0.9% 1.1%
Year over Year 1.6% 0.5% 1.9% 2.0%

Manufacturing orders rose a slightly stronger than expected 1.4 percent on the month in April. The increase followed an upwardly revised 1.1 percent gain in March but base effects saw annual growth slow from 2.0 percent to 0.5 percent. This was the first back-to-back gain in orders since September/October 2014.

The monthly advance in total orders reflected a 2.3 percent rise in capital goods and a 4.5 percent rebound in consumer and durables. However, basics were down 0.9 percent.

In contrast to March, growth was wholly attributable to overseas demand where orders were up a monthly 5.5 percent after a 1.4 percent contraction last time. Within this, orders from the other Eurozone countries gained fully 6.8 percent. The rest of the world recorded a 4.7 percent increase. Domestic orders, having risen 4.3 percent at the end of last quarter, declined 3.8 percent. Compared with April 2014 domestic orders were 1.4 percent weaker but overseas demand 1.9 percent firmer.

Despite the mixed composition the second consecutive monthly increase in overall orders bodes moderately well for industrial output over the rest of the quarter. Indeed, the level of orders in April was a healthy 1.8 percent above their first quarter average. Even so, April was still some 1.2 percent below the level at the end of last year, implying a clear slowdown in manufacturing momentum so far in 2015.

Manufacturers' orders measure new orders placed for manufactured goods, both domestic and foreign.

Manufacturers' orders data are keenly awaited by analysts each month. The data present a detailed breakdown by various sectors and a reading of the pulse of a major sector of the economy. Like the PPI, manufacturing orders data exclude construction, which is the preferred Eurostat measure.

The manufacturers' orders data rank among the most important early indicators for monitoring and analyzing German economic wellbeing. Because these data are available for both foreign and domestic orders they are a good indication of the relative strength of the domestic and export economies. The results are compiled each month in the form of value indexes to measure the nominal development of demand and in the form of volume indexes to illustrate the price-adjusted development of demand. Unlike in the U.S., orders data are not collected for all manufacturing classifications - but only those parts in which the make-to-order production plays a prominent role. Not included are, for example, mining, quarrying and the food industry.