German Manufacturing Rebounds Strongly

By Dow Jones Business News, 
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FRANKFURT--Manufacturing orders in Germany increased more than expected in April on the heels of strong foreign demand, the country's statistics office said Thursday, signaling a good start for Europe's largest economy in the second quarter.

New orders increased 3.1% on the month in adjusted terms, surpassing economists' expectations for a 1.5% rise. The rise more than made up for a disappointing March, when monthly orders fell 2.8%.

"After a disappointing end of a strong first quarter, doubts about the strength of the German recovery had gradually surfaced. Today's data shows that at least the industry is alive and kicking," ING economist Carsten Brzeski said in a note.

This time, orders from outside Germany carried the index, with foreign orders increasing 5.5% on the month in April. Much of that came from inside the euro zone, where orders jumped 9.9%. Foreign orders from outside the euro zone increased 3.1%, while domestic manufacturing orders were flat compared with March.

German manufacturing has been one of the driving forces behind the euro zone's return to growth that started in the second quarter of last year, and a sustained slowdown in such a key element would be a fresh source of concern for policy makers.

Last month, the country's central bank said the German economy will grow at a slower tempo in coming months, as the positive effect of the mild winter in the first three months of the year weighs on the seasonally adjusted growth rate in the current quarter. Still, the lower growth rate "should not be interpreted as a slowdown in the underlying economic momentum," the bank said.

--Paul Hannon in London and Todd Buell in Frankfurt contributed to this article.

Write to Christopher Lawton at Christopher.Lawton@wsj.com

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This article appears in: International , Economy


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