Data published by the Federal Statistical Office (Destatis) showed that in May, factory orders fell by 1.6%, accelerating compared to April (-0.6%, revised from -0.2%). It was the sharpest drop since January. Economists had expected a 0.5% increase. Meanwhile, over the last three months (through May), factory orders decreased by 6.2% compared to the previous three months. However, when large-scale orders are excluded, new orders fell by 2.2% compared to April.
Destatis said that in the "manufacture of other transport equipment" sector (aircraft, ships, trains), new orders fell by 19.2% m/m. The marked decline in this sector is due to a smaller volume of large-scale orders in aircraft construction compared with the previous month. The 2.9% drop in orders observed in the automotive industry also had a negative impact on the overall result, while increases in the “manufacture of computer, electronic and optical products” sector (+11.2%) had a positive effect.
As for sectors, new orders fell in the capital goods sector (-4.3% m/m), but rose in the intermediate goods sector (+1.4% m/m) and the consumer goods sector (+4.9% m/m).
Meanwhile, foreign orders fell by 2.8% m/m, while new orders from the non-euro area decreased by 4.6% m/m. Meanwhile, new orders from the euro area remained almost unchanged (-0.1% m/m). Domestic orders rose by 0.5% m/m.