Frankfurt, May 5, (dpa/GNA) - German industry was heavily impacted by uncertainty surrounding the Ukraine war in March, with orders slumping by 4.7% compared to the previous month, the Federal Statistical Office announced on Thursday based on preliminary data.
“Substantial uncertainty due to the war in Ukraine, rising energy and raw material prices and a deteriorating global economy are leading to restraint in orders,” said Jupp Zenzen, an economist for the Association of German Chambers of Industry and Commerce (DIHK).
He added that there were acute supply chain problems due to coronavirus lockdowns in China.
Manufacturers of machinery and technical equipment were particularly hard hit by the insecurity, with orders slumping by 8.3% compared to the previous month. The consumer goods sector, on the other hand, recorded an increase of 6.4%.
Business in countries outside the euro area was particularly hard-hit, dropping by 13.2%. Orders from the common currency area, on the other hand, rose by 5.6% compared to the previous month. Overall, the volume of foreign orders decreased by 6.7%. Domestic orders fell by 1.8%.
The decline in total orders was stronger than expected by analysts, who on average had expected a 1.1% drop compared to the previous month.
Compared to the same month of the previous year, March 2021, new orders were 3.1% lower, adjusted for calendar effects.
Thomas Gitzel, the chief economist at VP Bank, expects that the summer months “will probably be a lean period for the German economy” in light of the Ukraine war, high inflation rates and supply chain problems.
GNA