07:13 AM EDT, 10/07/2024 (MT Newswires) -- In line with the recent weak sentiment indicators, German new orders fell significantly in August, noted Commerzbank.

Even if the 5.8% month-over-month drop compared with the previous month is partly due to a smaller number of big-ticket orders, Monday's data confirm that demand for German industrial goods has continued to weaken, wrote the bank in a note to clients.

This increases the risk that the German economy also shrank in Q3, stated Commerzbank. Although the figures for industrial production due out on Tuesday are expected to show a fairly significant increase -- after a weak July -- because car production is likely to have increased significantly as a result of shifts in the timing of plant closures during the summer.

For Q3 as a whole, however, German industry is expected to show a minus, according to the bank.

Q4 is also not expected to see any growth. Although the diminishing effect of the global interest rate hikes suggests that the economy will revive in the coming year, the many structural weaknesses of the German economy and the likelihood of continued sluggish demand from the important export market of China mean that the recovery is probably no more than moderate, it added.