CHFJPY Swiss Franc vs Japanese Yen

Germany's factory orders declined most in six months on weak foreign bookings in July, while domestic demand remained robust.

Factory orders dropped 1.4 percent in July from a month ago, which was the biggest fall since January when they slid 2.6 percent, data from Destatis revealed Friday.

Economists had forecast orders to fall 0.6 percent. Orders had increased 1.8 percent in June and decreased 0.3 percent in May.

In July, domestic orders increased 4.1 percent from the prior month. On the other hand, foreign orders fell 5.2 percent due to a 9.5 percent decrease in demand from countries outside euro area. New orders from the euro area gained 2.2 percent.

The economy ministry said domestic demand continued to remain positive. Data suggests a further slight upward activity in the manufacturing sector.

A drop in orders from outside the euro zone could suggest that the problems in the emerging markets are increasingly affecting German businesses, economists at Commerzbank said.

This supports rather cautious outlook for the coming quarters, due to which Commerzbank lowered the 2016 growth forecast to 1.5 percent from 1.8 percent.

On a yearly basis, factory orders slid unexpectedly by 0.6 percent in July reversing June's strong 7 percent expansion. Orders were expected to rise 0.4 percent.

Data today showed that manufacturers of intermediate goods registered a decrease of 0.2 percent and orders for capital goods dropped 1.6 percent from the prior month. For consumer goods, a decrease in new orders of 6.3 percent was reported.

Nonetheless, the Purchasing Managers' survey data showed this week that manufacturing activity logged its biggest growth in 16 months in August.

According to the PMI survey, new orders increased at the fastest pace since April 2014 and business from abroad improved in August following a marginal decline a month ago.

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