'Finally nothing to complain about': German factory orders jump 5.6%

German factory orders were up by 5.6% month-on-month in November, official figures showed on Thursday, in what observers hailed as a rare sign of hope for the ailing German economy.

Excluding large-scale orders, new orders rose by 0.7%, the Federal Statistical Office, also known as Destatis, said.

The agency also revised provisional figures for October, from 1.5% to 1.6%.

Compared to November 2024, factory orders were up by 10.4%.

New orders in manufacturing also grew over the less volatile three-month period and were up by 4% between September and November compared to the previous three months, thanks to an above-average number of large-scale domestic orders.

Excluding large-scale orders, new orders were up 2.1% in the same period.

Economists described the figures as a welcome sign that the German economy might finally have overcome its sustained slump, following two consecutive years of recession in 2023 and 2024.

"Finally, a figure from the German economy that there's nothing to complain about," said Jens-Oliver Niklasch from the Landesbank Baden-Württemberg.

Thomas Gitzel, chief economist at VP Bank, also welcomed the figures as an economic surprise, predicting that factory orders will continue to be driven by the defence industry in the coming months.

Sebastian Dullien, director of the Macroeconomic Policy Institute of the Hans-Böckler-Foundation, a political think tank, agreed that defence orders will continue to boost the figures in the coming months, as the sector continues to see a sustained boom in the wake of Russia's invasion of Ukraine.

Dullien predicted that the German economy would fare much better in 2026 than it did last year, as billions in planned government spending on defence and infrastructure are set to kick in.

According to the statistical office, domestic orders were up 6.5% in November, largely driving growth. However, demand from abroad also increased by 4.9%.

Manufacturers of "fabricated metal products" saw particularly strong growth, with orders in the sector rising by 25.3%, while orders for transport equipment including aircraft, ships, trains and military vehicles was up by 12.3%.