Further signs of slump in eurozone

EUROPEAN industrial orders increased less than economists estimated in October, adding to signs of a deepening economic slump in the single-currency region.

Further signs of slump in     eurozone

Orders in the 17-nation euro region rose 1.8% from September, when they dropped 7.8%, the European Union’s statistics office in Luxembourg said yesterday. Economists had forecast orders to increase 2.5%, the median of 11 estimates in a Bloomberg News survey showed.

Producer-price inflation slowed to 5.3% in November from 5.5% in the previous month, a separate report showed.

Cooling global growth, rising unemployment and budget cuts from Spain to Italy may make it difficult for European manufacturers to sustain order growth, pushing the economy closer to recession.

Siemens AG, Europe’s largest engineering company, said on December 21 that it planned to cut jobs to shore up earnings.

Eurozone manufacturing output contracted for a fifth straight month in December.

“Overall, the trend is likely to point downward, supporting our view that euro-area gross domestic product will contract for three consecutive quarters from the fourth quarter of 2011,” said Thomas Costerg, an economist at Standard Chartered Bank in London. Recent data “reinforce our view that the economy is already in recession”.

Eurozone orders rose 1.6% from a year earlier after a similar increase in September, yesterday’s report showed.

Orders for capital goods advanced 1.6% from September, when they fell 8.1%.

Orders for durable consumer goods dropped 2.3%, while those for intermediate goods slipped 0.2%.

Total orders, excluding heavy transport equipment such as ships and trains, fell 0.5% from the previous month.

The European Commission will release the report today.

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