German industry is threatened with recession: order backlog has fallen more sharply than ever before - financial expert warns of a downward trend

German industry is threatened with recession: order backlog has fallen more sharply than ever before - financial expert warns of a downward trend

According to a report by amp2.handelsblatt.com, the order backlog of German industry fell more sharply in September 2023 than ever since statistics began in 2015. Mechanical engineering and the automotive industry are particularly affected, whose order backlogs were 2.7 percent and 2.9 percent lower, respectively, than in the previous month. This decline is a consequence of the world's restrictive monetary policy and the high level of political uncertainty, which is leading to a rapid decline in stocks of foreign orders and capital goods. The backlog range fell to 7.0 months in September, the lowest level in more than two years. The export-heavy industry has also recently reduced its production in three of the past four months, due, among other things, to the weak global economy and weak export business with China.

Given these developments, German industry could be faced with a further reduction in production and a decline in exports in the coming months. Falling demand for German goods due to restrictive monetary policy and high political uncertainty is likely to worsen the situation. German companies could be forced to further reduce production, which could have a negative impact on employment and economic growth. Overall, these are worrying signals for German industry and the financial sector, as they point to a possible slowdown in the economy.