The figures added further to evidence the economic recovery is slowing as member states look to reduce the size of budget deficits in the wake of the sovereign debt crisis.
Factory orders dropped 2.4 per cent from June – the sharpest decline since December 2008 – but were 11.2 per cent higher than a year earlier, the European Union’s Eurostat statistics agency said
Eurostat said after stripping out demand for heavy transport equipment like ships, railway and aerospace equipment, which can be volatile and have a limited impact on production, industrial orders fell 0.6 per cent in July.
There was also a 5.1 per cent slump in orders for capital goods – such as machinery and equipment used in production processes – in July following a 3.8 per cent rise in June.
Orders for consumer goods, such as household electrical appliances and business equipment, also dropped 3.2 per cent in July after falling 1.3 per cent in June. Orders were 1 per cent lower than a year earlier.