By Don Nico Forbes
German manufacturing orders rose in May, showing tentative signs of stabilizing despite continued uncertainty from the Middle East conflict.
Factory orders rose 1.9% on month in May, following a 3.2% decline in April, data agency Destatis said Monday. Economists polled by The Wall Street Journal had expected a smaller increase of 0.7%.
In the less volatile three-month comparison, new orders from March to May 2026 were 0.2% lower than in the previous three months, Destatis said.
Growth in orders for May was largely attributable to a jump in other-vehicle construction, including aircraft, ships, trains, and military vehicles. New orders in this sector were up 85% on month, driven by several large contracts, Destatis added.
Germany's manufacturers have faced a difficult backdrop this year. Elevated energy prices following the conflict between the U.S. and Iran pushed up costs for businesses, while uncertainty over the global trade outlook has weighed on investment decisions and export demand.
However, conditions have become somewhat more favorable since the end of May. Oil and natural gas prices have fallen back after easing tensions between the U.S. and Iran calmed fears of prolonged supply disruptions, reducing pressure on manufacturers' input costs and improving business sentiment.
Write to Don Nico Forbes at don.forbes@wsj.com