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German Industrial Orders Rise In January

Economy Ministry said industrial orders surged 4.3 percent as demand increased for big-ticket goods, following a 1.6 percent month-on-month decline in December.

BERLIN (AP) -- German industrial orders increased by an unexpectedly strong 4.3 percent on the month in January amid a broad-based rise in demand, particularly at home, government data showed Friday.

The big increase more than made up for a 1.6 percent month-on-month decline in December, the Economy Ministry said. That figure was revised from an initial estimate of a 2.3 percent decline.

January's rise was powered by a 7.1 percent increase in orders from within Germany, the ministry said.

Orders from abroad were up by a less spectacular 1.9 percent; while euro-zone orders increased by 6 percent, demand from outside the 16-nation bloc slipped by 0.7 percent.

The overall improvement was helped by an above-average number of large orders, the Economy Ministry said. Orders for so-called investment goods such as machinery were up 3.7 percent overall; orders from inside Germany were up 10 percent.

Germany's economy -- Europe's biggest -- returned to modest growth last year after a sharp recession but stagnated in the fourth quarter.

January's increase in industrial orders was far stronger than the 1.3 percent economists had predicted.

The rise -- the strongest since December 2004 -- suggested that the previous month's drop was only a temporary pause and the recovery remains healthy, said Carsten Brzeski, an economist at ING in Brussels.

"Between February 2009 and January 2010, new orders have increased by more than 22 percent, boding well for industrial production in the coming months," he added.

Volatility in bulk orders played a part in the rebound, said Alexander Koch, an economist at UniCredit in Munich, but the figures also reflected an ongoing revival in global industrial activity.

"The temporary massive impulse from the inventory cycle and fiscal programs will inevitably moderate substantially in the course of this year," Koch said. "However, for the time being the tailwind remains ample."

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