German industrial orders surge as autos bottleneck clears

BERLIN (Reuters) - German industrial orders rebounded in August as an auto sector bottleneck cleared and deals with customers outside Europe picked up sharply, and the economy ministry said manufacturing should power ahead in the fourth quarter.

Contracts for German goods rose by 2.0 percent after a fall of 0.9 percent in the previous month, the ministry said on Friday. A Reuters poll of analysts had predicted a rise of 0.5 percent in August.

"The strong increase in orders from non-European countries proves that German industrial products remain in demand worldwide, regardless of trade conflicts," the ministry said in a statement.

It said the rise was helped by a clearing bottleneck in the auto sector that had stemmed from the introduction of a new pollution standard - the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) - for which some German car models needed to gain regulatory clearance.

With that hurdle overcome, "the positive economic trend in the industrial sector should resume in the fourth quarter," the ministry said.

Friday's stronger-than-expected data followed a solid business confidence reading from Europe's largest economy last week.

The Ifo economic institute's survey showed business morale held steady in Germany in September, propped up by consumer spending and construction, pointing to further growth even if a uncertain global economic outlook worsened.

"We don't need to worry about the German economy, even if in 2018 it looks like there will be a slower rate of growth than originally expected," said Thomas Gitzel, economist at VP bank.

The government has forecast 2.3 percent growth this year and 2.1 percent for 2019.

(Writing by Paul Carrel; Editing by Maria Sheahan and John Stonestreet)