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German industrial orders up sharply

Industrial orders in Europe’s largest economy have jumped, the government has said, pointing to strong demand at home and across the 19-member eurozone. Growing political uncertainties had no big impact.Higher demand for capital goods in Germany and abroad drove the biggest monthly increase in German factory orders in about one and a half years in December, the Economics Ministry announced on Monday.

Domestic demand rose by 6.7 percent in the month under review, while foreign orders increased by 3.9 percent. Bookings for the 19-member euro area soared by 10 percent in December.

The fresh data gave some reassurance that Germany’s economic upswing would carry into 2017 despite growing political uncertainties such as a protectionist US trade agenda.

Shifting into higher gear

“Despite the uncertainties, the German economy is showing a more than robust development,” Sal. Oppenheim economist Ulrike Kastens said in a statement, adding she now expected quarterly growth of around 0.6 percent in the first quarter of 2017, after a 0.5-percent expansion in the final three months of last year.

ING Diba analyst Carsten Brzeski warned “the coming months will definitely bring some negative surprises,” pointing to the start of Brexit negotiations.

“Even so, today’s data suggest that German industry could shift into higher gear in the first quarter.”

hg/jd (AFP, Reuters)

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