German industry continues to be plagued by the consequences of the Ukraine war. The general uncertainty coupled with ongoing supply bottlenecks is causing lower demand.

German industry once again received significantly fewer orders in April. Compared to the previous month, orders fell by 2.7 percent, the Federal Ministry of Economics announced on Tuesday, citing data from the Federal Statistical Office.

It is the third decline in a row. Analysts had expected an increase of 0.4 percent. The most recent decline follows an even clearer setback in the previous month, which at 4.2 percent is a little less severe than previously known. In February, demand fell by 1.3 percent. The Federal Ministry of Economics explained the weak development primarily with the Ukraine war.

In detail, the development was consistently weak. 4.0 percent fewer orders came from abroad, and 0.9 percent fewer orders were placed in Germany. The demand for capital goods such as machines fell particularly sharply at 4.3 percent. Consumer goods were ordered 2.6 percent less, orders for intermediate goods fell by 0.3 percent.

The Economy Ministry commented that heightened uncertainty over the Russian invasion of Ukraine is leading to weak demand, particularly from abroad. However, the companies continue to have well-filled order books. “Overall, the outlook for industrial activity in the coming months is subdued.”

Bank economists made similar statements. The interim order boom has subsided significantly, explained Commerzbank economist Ralph Solveen. The reasons for the weakening are lower demand from China, for example, and the ongoing supply bottlenecks for many goods. A quick turnaround is not to be expected.