GEW October 7, 2009

GER: Manufacturing Orders rose 1.4%mom in August, the sixth straight month that orders have increased and came in better than market expectations of a 1.1% increase over July. Compared with August last year however, orders continue to reveal the manufacturing destruction of the Credit Crisis, down 20.4%. Orders rose on the back of foreign orders that increased 4.6% over the month in August after having slid 2.4% in July. Since the beginning of the year, foreign orders have increased in four of the eight months for which data has been made available. Nevertheless, the dismal story on an annual comparison continues. Domestic orders that have consistently picked up over the last five months eased in August to be 1.9% lower over the month. In terms of industrial groups, capital goods orders rose 1.2%mom, the fourth straight month of increase on the back of a 6.5%mom rise in capital goods orders from outside the country.

EUR: Final estimates of Real GDP Growth printed at 0.2%qoq in Q2 2009 to be down 4.8% over the year. The preliminary estimate of economic activity in Q2 2009 had come in at -0.1%qoq. Economic output in the second quarter saw household consumption expenditure gain 0.1%qoq and Government spending surge 0.7% after having increased 0.6% in the previous quarter. Investments however remained sluggish, lower by 1.5%qoq following a 5.4% sharp drop in Q1 and the external sector also weighed in as imports fell 2.9% over the quarter while exports were down 1.5%qoq. In terms of industries, agriculture output jumped 0.2%qoq from a contraction of 0.7% in the previous quarter; industrial activity was depressed by 1.9% over the quarter and construction pared 0.4% in output over the quarter; while financial services activity nudged down 0.1% in Q2. Economic output in Germany rose 0.3% over the quarter in Q1 but contracted 5.9% over the year. The French GDP also rose 0.3%qoq but contracted only 2.8% over the year, lesser than the German contraction.