(Lead roundup added)
WIESBADEN (dpa-AFX) - The war in Iran weighed on industrial demand in April. Incoming orders fell more sharply than experts had anticipated.
Orders decreased by 3.8 percent on a seasonally and calendar-adjusted basis compared to the previous month, the Federal Statistical Office (Destatis) announced in Wiesbaden on Monday. Economists surveyed by Bloomberg had expected a decline of only 2.0 percent. Furthermore, the increase in March was revised slightly downward by half a percentage point to a gain of 4.5 percent. In the less volatile three-month comparison, order intake from February to April was 3.1 percent lower than in the preceding three months.
The war in Iran continues to drive up energy prices and fuel uncertainty. While order figures had recovered in March, this was attributed to front-loading as companies feared price hikes resulting from the conflict. 'The slump in sentiment indicators such as the Ifo Business Climate Index suggests no immediate recovery is in sight,' said Commerzbank Chief Economist Jörg Krämer. 'Instead, the German economy is likely to shrink slightly in the second quarter. The war in the Middle East is taking its toll.'
The development of orders was weighed down by a significant decline in new orders in the automotive industry (-5.3 percent month-on-month) and in the manufacture of electrical equipment (-16.3 percent). In mechanical engineering, orders fell by 7.4 percent.
Foreign demand also showed weakness, particularly from the eurozone. Total export orders fell by 4.2 percent. Within this figure, orders from the eurozone dropped by 11.1 percent, while orders from outside the eurozone rose by 0.8 percent. Domestic orders decreased by 2.9 percent.
Industrial production figures for April will be released on Tuesday. Economists expect a slight increase./jsl/stw
