By Maria Martinez
(Reuters) -German industrial orders climbed more than expected in September, thanks to increases in demand for automobiles and electrical equipment, according to data released on Wednesday.
Orders in Europe’s largest economy increased by 1.1% from the previous month on a seasonally and calendar-adjusted basis, the federal statistics office said on Wednesday.
A Reuters poll of analysts had expected an increase of 1%.
Excluding big-ticket items, new orders were up 1.9% from the month before.
This core indicator of order intake, which provides a better picture of underlying trends than the total figure, continues to move sideways, said Ralph Solveen, a senior economist at Commerzbank.
A less volatile three-month comparison showed that new orders were 3.0% lower in the third quarter than in the second quarter.
“There is still no sign of a sustained recovery in demand for German industrial goods, which is unlikely to occur until next year in view of the significantly expansionary fiscal policy,” said Solveen.
DEPENDENCE ON FOREIGN DEMAND IS INCREASING
Foreign orders were up 3.5%, while domestic orders declined 2.5%, the data showed.
Although this means that dependence on foreign markets has grown, this could change in the foreseeable future, said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.
Higher infrastructure spending, a package of tax breaks and eventual cuts for companies, lower electricity prices due to government support starting next year and increased defence spending should contribute to strengthening domestic demand, de la Rubia said.
(Additional reporting by Emanuele Berro and Simon Ferdinand Eibach, Editing by Miranda Murray and Thomas Derpinghaus)
