German industrial production drops unexpectedly in June

FRANKFURT-German manufacturing orders rebounded sharply in June, beating forecasts, owing to strong demand from outside the eurozone and boosted by bulk orders.

Alexander Krüger from Bankhaus Lampe told Reuters that the Germany-based private bank, therefore, expected foreign trade to support strong consumers spending as the main pillar of German economic growth in the summer quarter.

UniCredit economist Andreas Rees said that after the output figure he had trimmed his growth forecast for the April-June period to 0.4 percent on the quarter from 0.5 percent.

According to figures published by Destatis, factory orders in the Eurozone’s biggest economy climbed a seasonally and working-day-adjusted 2.0% month-on-month in June, from a downwardly revised 0.3% drop in the previous month.

Food-processing technology maker GEA’s orders dropped by 9 percent on an organic basis in the second quarter. Domestic orders however declined 2.0% on the month.

German companies are growing in confidence.

Germany’s trade surplus slipped to 22 billion euros ($24 billion) from 22.8 billion euros in May.

Economists at BayernLB blamed the Greece crisis and the effects of an earlier major train strike for the disappointing figure and predicted a recovery, given a recent rise in factory orders.

But truck maker MAN SE cut its profit and sales expectations for this year because of a plunge in Brazilian demand.