Strong domestic demand boosts German industrial orders in December

Berlin-Germany’s industrial orders increased more than expected in December, data showed on Friday. Rising domestic demand gave an optimistic view of Europe’s largest economic growth outlook.

According to Federal Statistics Bureau statistics, commodity orders increased by 2.8% per month on seasonally adjusted conditions after a revised increase of 3.6% in November.

Analyst Reuters polls pointed out a slight increase of 0.5 percent per month.

Domestic orders saw an increase of 11.7 percent per month. Orders from other parts of the euro area fell 4.2% in December after an increase of 13.1% in the previous month.

“The company is clearly ready for recovery and is sitting on the upward start block,” said LBBW analyst Jens Oliver Niclasti.

“What we need now is, above all, the elimination of coronavirus restrictions and security in the supply chain, and we can expect strong growth in GDP this year,” he added.

The Ministry of Economy said that if higher backlogs are eliminated, index levels are showing dynamic economic development and supply bottlenecks are expected to gradually disappear.

“This is a great growth rate, but we already have a lot of backlogs,” said Alexander Krueger, an analyst at private bank Hauck Aufhaeuser Lampe. “The important thing is that we can process more orders in the near future.”

Germany’s industrial production fell unexpectedly in November. This is because the bottleneck in the supply of raw materials and spare materials has led to backlogs from German manufacturers.