In July, German factory orders dropped by 2.2% M/M, while an increase by 0.5% M/M was expected. The previous figure was however upwardly revised from 3.2% M/M to 3.6% M/M. The details show that weakness was mainly based in foreign demand (-3.7% M/M) from euro zone countries (-6.1% M/M), but also domestic orders dropped slightly (-0.3% M/M). Manufacturing (-2.2% M/M), capital goods (-5.5% M/M) and consumer goods (-1.0% M/M) orders fell in July, while intermediate goods orders rose by 2.5% M/M. On a yearly basis, German factory orders rose by 17.7% Y/Y (from 24.7% Y/Y). After a very strong second quarter, this outcome adds to the expectations that German growth will slow down in the second half of the year, although growth is expected to remain on track.