VDMA Factory Orders Remain Weak in June

German machinery orders came in at -9%Y/Y in June. While that was an improvement over May's -27%Y/Y, the overall trend remains contractionary: With the exception of April, the machinery orders' Y/Y rate has printed below 0% for a consecutive 21 months. For 1H24 in total, orders remained 12% below comparable 2023 values.

• The press release notes that: "The order situation is disappointing overall. The balance for the first half of the year is therefore clearly negative. A turnaround is not yet in sight."
• Looking at a geographical split, the decline in June was relatively evenly distributed. Domestic orders declined by 8% Y/Y, foreign orders by 10%. For 1H overall, domestic orders were noticeably weaker than foreign orders (-18% Y/Y / -9% respectively). That does not mean domestic orders really recovered recently - rather, they might be declining at a smaller rate.
• June overall German factory orders as well as industrial production will be released next week - while a consensus estimate for the data is not available yet, they will provide a key update on whether the recent renewed weakness in manufacturing is set to intensify or taper off.

MNI, VDMA