German industrial orders fall unexpectedly in July

BERLIN (Reuters) - German industrial orders fell unexpectedly in July on weak foreign demand, data showed on Thursday, in a further sign that factories in Europe's largest economy are feeling the bite of protectionist trade policies.

The Federal Statistics Office said contracts for 'Made in Germany' goods were down by 0.9 percent after a revised plunge of 3.9 percent in the previous month.

The reading undershot a Reuters poll of analysts who had predicted a rise of 1.8 percent.

Foreign orders dropped by 3.4 percent, with demand from clients outside the euro zone plunging the most, the data showed. Domestic orders rose by 2.4 percent.

A sector breakdown of the figures showed that orders for capital goods came in particularly weak. Demand for consumer goods edged down while orders for intermediate goods rose.

The Economy Ministry pointed to trade-related uncertainties from abroad as the main reason for orders falling in six of the past seven months.

"Order intake in the manufacturing sector has slowed noticeably since the beginning of the year after a very dynamic second half of 2017," the ministry said.

"The worldwide uncertainty caused by trade conflicts probably played a role here," it added.

U.S. President Donald Trump has triggered trade disputes with China, Europe and many others regions by imposing steep tariffs on a broad range of products in his pledge to protect American jobs against what he calls unfair trade practices.

Unicredit analyst Andreas Rees also pointed to special effects such as holidays and slower production in the car industry due to changes in emissions regulation.

(Reporting by Michael Nienaber, editing by Thomas Seythal and Maria Sheahan)