German industry orders dipped more than expected in December on falling demand from outside the eurozone for big ticket items, reversing November's sharp gains as analysts said the country's manufacturing outlook remained buoyant. Friday's economy ministry data, which showed orders fell 3.4 percent, sent the euro lower as markets fretted about the implications of a dip in external demand for Germany's traditionally export-driven economy.
The numbers are closely watched as an indicator of how industry is faring, but they are often volatile and analysts said their recent underlying broad upward trend was likely to continue, though it might weaken somewhat. Germany's manufacturing sector maintained robust growth in January but felt input prices rising to their fastest rate in at least 14 years, the Markit Purchasing Managers' index showed last week.
The mid-range forecast for Friday's seasonally and price-adjusted orders in a Reuters poll of 37 economists was for a fall of 1.5 percent. In November, orders had surged by 5.2 percent. Demand for capital goods fell 6.6 percent overall in December, with non-eurozone countries alone demanding 15.5 percent less. The euro fell to a two-week low after the data. On Monday, an index tracking investor sentiment showed a rise to a three-and-a-half year high in February, signalling that the currency bloc's economy may yet pick up speed.
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