German Industrial Orders Drop 1.4% in May, Hungary Output Falls 2.6%

Hungary's industrial output fell by 2.6% year-on-year in May, a sharper decline than analysts anticipated, primarily due to drops in the electrical equipment and food products sectors, despite some growth in transport equipment and electronics manufacturing. Meanwhile, German industrial and factory orders also dropped by 1.4% in May, missing expectations and marking the first monthly decline in three or four months, with particular weakness in domestic demand and a sharp 17.7% reduction in orders for computer, electronic, and optical products following unusually large orders in April. The downturn in Germany's factory orders was partially offset by a 2.9% rise in foreign demand, especially from non-euro area countries, but domestic orders slumped by 7.8%. Despite the monthly drop, German orders remained 5.3% higher than a year ago, and on a three-month basis, factory orders were up 2.1%, helped by a trade truce. Both Hungary and Germany's data point to ongoing volatility in Europe's industrial sector, influenced by sector-specific swings and broader economic uncertainty.