German factory orders fell for the fifth consecutive month in May, with a sharper drop of 1.6% compared to April. While domestic orders slightly rose by 0.5%, a significant decline of 2.8% was seen in foreign demand, particularly from the non-eurozone.
Impact on the German Economy
The German Economy Ministry expects “rather subdued” industrial activity in the coming months due to the latest figures and a decrease in business expectations. The economy is projected to stabilize once global trade improves and demand for industrial products increases.
Germany’s struggle to recover from the impacts of the war in Ukraine and a decrease in manufacturing sector caused the economy to shrink in 2023. The government has revised the growth forecast to 0.3% this year, down from the initial projection of 1.3%.
Despite these challenges, Germany remains a key player in European growth and faces the task of overcoming economic obstacles to drive progress in the region.
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