The Economy Ministry for Germany warned this sector of Europe’s largest economy was likely to remain weak in the coming months contracts for ‘Made in Germany’ goods were down by 2.2 percent on the month. The reading undershot the Reuters consensus forecast for a 0.1 percent decline and sparked a string of pessimistic comments from European economy analysts. ING economist Carsten Brzeski said: “The great order book deflation continues. Devastating new orders data just undermined any hopes for an industrial rebound.”

VP Bank economist Thomas Gitzel added after the orders data was published: “What misery.

“Given the significant decline in incoming orders, industrial production will remain extremely weak in the second half of the year and that increases the risk of recession for the German economy.”

It comes just days after the manufacturing sector contracted in June for the sixth time in a row, sparking deeper concerns for the financial state of Germany.

IHS Markit’s Purchasing Managers’ Index (PMI) for manufacturing, which accounts for about a fifth of the economy, rose to a four-month high of 45.0 in June, but still remained below the 50.0 mark separating growth from contraction.

Anything below 50.0 indicates an area has shrunk for that time frame.

The DIHK Chambers of Industry and Commerce this week more than halved its forecast for export growth this year, predicting a lacklustre 1.0 percent expansion.

This is down from the 2.5 percent growth predicted in autumn 2018.

Germany has been impacted by global tensions following the increasingly bitter United States-China trade war, as well as political uncertainty from Brexit.

Car sales have largely dented from a slowdown in demand due to caution from buyers, while stricter emissions testing has also put drivers off purchasing.

The VDMA engineering body said retaliatory tariffs on imported goods imposed by the US and China would contribute to a 2 percent decline in production this year.

Now its 10th year of expansion, the German economy returned to growth between January and March, posting a 0.4 percent expansion.

But the picture could turn sour as the Bundesbank expects a small contraction in the second quarter.

The Bundesbank said this month it expects the economy to shrink slightly between April and June after an expansion of 0.4 percent between January and March.

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