- German Factory Orders dropped 2.1% MoM in December.
- German Factory Orders slumped 8.7% YoY in December.
- EUR/USD keeps its range around 1.1000, eyes EU Economic Forecasts.
The German Factory Orders data unexpectedly dropped in December, suggesting that the manufacturing sector recession in Europe’s largest economy is deepening.
Contracts for goods ‘Made in Germany’ arrived at -2.1% on the month vs. +0.6% expected and -1.3% last, the latest data published by the Federal Statistics Office showed on Thursday.
On an annualized basis, Germany’s Industrial Orders plunged 8.7% in the final month of 2019 vs. -6.0% expectations and -6.5% previous.
About German Factory Orders
The Factory orders released by the Deutsche Bundesbank is an indicator that includes shipments, inventories, and new and unfilled orders. An increase in the factory order total may indicate an expansion in the German economy and could be an inflationary factor. It is worth noting that the German Factory barely influences, either positively or negatively, the total Eurozone GDP. A high reading is positive (or bullish) for the EUR, while a low reading is negative.
FX Implications
The shared currency showed little reaction to a big miss on the German Factory Orders data, leaving the EUR/USD pair mostly unchanged around the 1.1000 region amid a risk-on market profile, triggered by strong US macro data and fresh US-China trade optimism.
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