UPDATE 1-German industrial orders slide to record low as virus hits

(Adds details from economy ministry, economist)

BERLIN, May 6 (Reuters) – Orders for German industrial goods collapsed in March to their lowest level since records began in 1991, data showed on Wednesday, as the coronavirus slashed domestic and foreign demand for goods from Europe’s biggest economy.

Statistics Office figures showed a 15.6% dive in orders for Made in Germany goods, far worse than a Reuters poll of analysts for a 10.0% fall.

Germany is braced for its deepest recession since World War Two, the economy minister has warned as a lockdown has shuttered shops, businesses and factories, although a gradual easing of restrictions has started.

The economy ministry blamed the dramatic fall in orders on the global economic shock of the coronavirus and the steps taken to slow down its spread.

“It is to be expected that production will decline sharply from March onwards due to corona,” the ministry said in a statement.

Domestic contracts slumped by 14.8% and orders from abroad were down by 16.1%, a huge blow for an export-oriented economy.

“The significance of the figures on incoming orders can hardly be topped,” said Thomas Gitzel, Chief Economist at VP Bank Group, adding the scale of the decline does not bode well.

“They show how strong the effects of the corona crisis will still be on manufacturing industry … Even during the financial market crisis, orders did not collapse as sharply,” he said.

Demand for capital goods was hit particularly hard, down 22.6%, the data showed. (Reporting by Madeline Chambers Editing by Riham Alkousaa and Paul Carrel)

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