German factory orders jump most in a year, suggesting recovery

German factory orders rose 5.6% in November, the biggest monthly gain in a year, and activity excluding large-scale orders increased 0.7% after two prior monthly gains.

German factory orders rose for a third month in November, with demand jumping 5.6% from October. That was the biggest monthly gain in a year and followed two earlier increases that hinted at a manufacturing recovery. Even excluding large-scale orders, activity rose 0.7%, while economists had expected a 1% decline. The reading comes as Chancellor Friedrich Merz has warned parts of the economy are in a "very critical" condition and as advisers have trimmed this year's growth outlook to below 1%. Key facts: - Factory orders increased 5.6% month-on-month in November, the largest monthly rise in a year. - Excluding large-scale orders, factory activity rose 0.7% in November. - Economists had forecast a 1% decline for the month. - Germany's overall expansion last year was modest, with some forecasts around 0.2%. - Carmakers are reported to be under pressure from international competition and tariffs, and about 100,000 jobs in that industry are expected to disappear by the end of the decade. - Chancellor Merz has said reviving growth is a top priority and his party begins a two-day meeting in Mainz to discuss planned social reforms. Summary: The stronger-than-expected order data suggest parts of manufacturing may be stabilizing after weak periods, but broader challenges in competitiveness and the auto sector remain. Economic advisers have reduced their outlook for the year to below 1%, and Chancellor Merz has made reviving growth a focal point. His party will meet in Mainz for two days to discuss planned social reforms and related economic measures.