Roundup: Weak domestic demand worries German machine industry

The German machine and tool manufacturing industry warned on Wednesday that current domestic demand for German mechanical products was disappointingly low and the German government should create more encouraging circumstances for domestic investment.

In February, incoming orders for German-made machines and tools decreased by 3.0 percent from the same month of the previous year, according to German Engineering Association (VDMA). International orders stagnated, while domestic orders plunged by 7.0 percent.

In the three-month period between December 2014 and February 2015, which was less affected by short-term fluctuations, domestic orders remained unchanged when compared with a year earlier, while orders from abroad increased by 6.0 percent, driving the overall orders to increase by 4.0 percent year-on-year.

"Once again, domestic orders disappointed in February," said VDMA executive director Thilo Brodtmann in a statement. "Weakening domestic demand shows that we should not be blinded by record reports in exports."

Thanks mainly to private consumption and partly to foreign trade, the German economy expanded by 1.6 percent in 2014. Investment, which was initially expected to rebound at the beginning of last year, remained fragile as business confidence was hit by the Ukraine crisis and other uncertainties. Endit