Orders down 1.6 vs forecast 0.5 rise
Fifth drop in a row

BERLIN, July 4 Reuters German industrial orders fell unexpectedly in May, a fifth consecutive drop that adds to signs that manufacturing in Europe39;s largest economy will not recover in the coming months.

Orders were down by 1.6 on the previous month on a seasonally and calendaradjusted basis, the federal statistics office said on Thursday. Analysts polled by Reuters had expected a rise of 0.5.

Excluding largescale orders, new orders fell by 2.2 in May compared with the previous month. The threemonth comparison showed orders from March to May were 6.2 lower than the previous three months, due in part to a largescale order.

The downward trend is still in full swing, Hauck Aufhaeuser Lampe Privatbank chief economist Alexander Krueger said.

PMI data for manufacturing in June showed a continued downturn in the sector, which accounts for about a fifth of the German economy, while Ifo39;s latest business climate index showed manufacturers were sceptical about the months ahead.

The ongoing decline in orders, along with a deterioration in business expectations, points to a subdued industrial economy in the coming months, the German economy ministry said.

Incoming orders are only likely to stabilise as global trade continues to recover and demand for industrial products gradually picks up, the ministry said about the data.

The situation in global industry, for example in the United States and China, was also…