Tags: Euro | Zone | Industry | Orders

Euro Zone Industry Orders Post Top Gain in Decade

Thursday, 24 Jun 2010 08:56 AM

Euro zone industrial new orders rose in April at their fastest annual pace in 10 years, data showed on Thursday, as an export-driven economic recovery continued despite tension in the currency area's debt markets.

Industrial new orders in the 16-country zone gained 0.9 percent month-on-month and 22.1 percent year-on-year, European Union statistics office Eurostat said.

They surged by a revised 5.1 percent month-on-month in March, a small downward correction from the previous reading, highlighting partly the collapse of industrial activity in early 2009 during the worst economic crisis in decades.

"It's quite a good reading. After the surge we have seen in the month of March, this is really another strong report. And it suggests the manufacturing sector is still on a really good recovery path," said Juergen Michels, economist at Citigroup.

The annual rise was the steepest since May 2000 and bigger than the 21.5 percent expected on average by analysts polled by Reuters. They had forecast a 1.6 percent month-on-month gain.

The data reinforced a positive picture for manufacturers, driven by demand from abroad and a weakening euro, while domestic economies struggle. Industrial orders point to trends in activity as they translate into production in coming months.

But in May the euro area was hit by a sovereign debt crisis linked to Greece's budget deficit problems, which analysts say might have hit the real economy.

Without volatile orders for ships, planes and trains, the monthly increase in April was 1.1 percent and the year-on-year jump 23.1 percent.

Orders in the euro zone's biggest economy, Germany, rose 3.3 percent on the month and surged 32.4 percent year-on-year.

Italy and the Netherlands also had growth in industrial orders in April, but Spain and France suffered declines.

Orders for durable consumer goods in the euro zone fell 0.9 percent on the month and rose only 11.2 percent annually.

"This highlights the fact that the consumer has been a persistent weak link in the euro zone's overall limited recovery since exiting recession in the third quarter of 2009," said Howard Archer, chief European economist at IHS Global Insight.

The European Commission forecast last month that the currency area's economy would expand by 0.9 percent this year, after shrinking 4.1 percent in 2009.

Eurostat said that in the wider 27-nation European Union, industrial new orders fell 0.2 percent in April compared with March and rose 21.8 percent annually.

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Euro zone industrial new orders rose in April at their fastest annual pace in 10 years, data showed on Thursday, as an export-driven economic recovery continued despite tension in the currency area's debt markets. Industrial new orders in the 16-country zone gained 0.9...
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Thursday, 24 Jun 2010 08:56 AM
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