FX.co ★ German Factory Orders Slump on Large-Order Reversal

Germany’s factory orders slumped by 10.6% month-on-month in August 2026, reversing an upwardly revised 3.2% increase in July and far exceeding market expectations for a 1.0% decline. This marked the first monthly drop since April and was driven largely by a 61.5% collapse in orders for aircraft, ships, trains, and military vehicles, following a more than twofold surge in July on the back of an exceptionally high volume of large contracts.

Orders weakened across all major categories, with capital goods down 15.3%, intermediate goods down 2.6%, and consumer goods down 7.3%. Domestic demand fell sharply by 17.3%, while foreign orders declined 5.4%, including a 5.4% drop in orders from the euro area and a 5.5% decline from non-euro area countries.

Excluding large-scale contracts, overall orders were almost flat, slipping just 0.1%. On a less volatile three-month moving basis, factory orders decreased 1.3% in June–August compared with the previous three months, or 2.6% when excluding large orders, underscoring persistent weakness in underlying industrial demand.