New orders at German factories declined sharply in November to their lowest level in more than two years, a sign of weakening demand for the country’s key manufacturing sector as the economy cools. Factory orders fell 5.3% on month in November, swinging from a 0.6% rise in October, according to price-adjusted data from the German statistics office Destatis released Friday. New orders declined in eight of the 11 months up to November, and currently stand at their lowest level since July 2020.
Economists polled by The Wall Street Journal expected orders to decline 0.6%. The fall in orders was mainly driven by a 8.1% drop in foreign orders, with those from the eurozone decreasing 10.3%. Domestic orders also fell, albeit at a softer rate of 1.1%. Germany’s manufacturing sector has been struggling with sluggish orders in recent months due to weakening demand amid a global economic slowdown. Even as the threat of gas shortages in the industry has eased markedly, high energy costs, elevated inflation and an uncertain economic outlook pose headwinds for the sector. Write to Xavier Fontdegloria at firstname.lastname@example.org