The large gain in German manufacturing orders in June (2% in the month) is due to strong orders for ships and trains. Excluding the always very volatile orders in the "other vehicles" sector, order intake fell by a good 1%. But after the strong gains in the two preceding months, the trend points clearly upwards here, partly because business in the euro zone seems to be reviving.



According to Commerzbank, "If we factor out the "other vehicles" sector, a minus of 1.1% on the month results rather than the reported plus of 2%. But since this decline follows two months with large increases in this core rate, our trend for industrial production, which is calculated on the basis of order intake in the past months, still points clearly upwards."



In recent months, demand from the other euro zone countries in particular has picked up noticeably. Although here the core rate declined by around 1% in June, this still gives a large gain in Q2 of more than 6% compared with the average of the first three months. Orders from outside the euro zone, in contrast, have rather lost momentum.



Whilst here, too, the core rate for Q2 posts a rise by 31⁄2%, it follows a fall by 2.6% in Q1. On trend, these orders (which in the past always pointed clearly upwards) have moved sideways since last autumn. This obviously reflects the negative impact of the loss of momentum in emerging markets, which should continue weighing on the manufacturing sector in the further course of the year, adds Commerzbank.