German Factory Orders drop 1.4% MoM in Feb vs. -1.9% exp, EUR/USD off highs

• German Factory Orders dropped 2.1% MoM in February.
• On a yearly basis. Germany’s Factory Orders jumped 1.5% YoY in February.
• EUR/USD eases-off daily highs, eyes coronavirus updates.

The German Factory Orders dropped in February, suggesting that the manufacturing sector in Europe’s largest economy is not out of the woods yet.

Contracts for goods ‘Made in Germany’ arrived at % on the month vs. -1.9% expected and +5.5% last, the latest data published by the Federal Statistics Office showed on Monday.

On an annualized basis, Germany’s Industrial Orders jumped 1.5% in the second month of 2020 vs. -1.4% 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 inched a few pips lower on the mixed German Factory Orders data, with the EUR/USD pair now paring gains to trade around the 1.0820 region amid a risk-on market profile. The spot hit a daily high of 1.0835 just a few minutes before the data release.