Euro-zone industrial new orders rose more than expected during the month of June, data showed on Monday, boding well for economic growth in the third quarter of 2010.
Industrial orders in the 16-nation currency zone increased 2.5% month-on-month for a 22.6% annual gain, European Union statistics office Eurostat said.
Economists polled by Reuters had expected figures of 1.5% and 22.9% respectively.
The data could point to another quarter of economic expansion as the euro-zone recovers from its sovereign debt problems and the worst economic crisis in decades. Orders point to trends in activity as they translate into future production.
Gross domestic product expanded by 1% in the second quarter from the previous one, the fastest pace in four years.
But some economists say growth could falter in the coming months, partly due to austerity measures ordered by E.U. many governments to ward off sovereign debt crisis. Slowing growth in the United States and China could also curtail EU exports.
Eurostat revised May industrial orders upwards to 4.1% month-on-month and 23% annually, from previous readings of 3.8% and 22.7%. The annual gain in May was the biggest in 10 years.
Eurostat said that without volatile orders for ships, planes and trains, the monthly increase in June was 1.6% and the year-on-year jump 22.5%.
The monthly growth in orders was driven almost exclusively by a surge in demand for capital goods, which include machinery, tools and equipment -- pointing to corporate sector investment. The figure rose 5.3% month-on-month and 22.7% annually.
But orders for durable consumer goods and non-durable consumer goods fell 1.1% and 1.8% respectively, highlighting weak consumer demand.
Analysts say growth will become self-sustaining only if consumers begins to spend more, a distant prospect considering that the unemployment rate near a 12-year high of 10%.
Eurostat said that orders in the euro-zone's biggest economy, Germany, increased 3.9% on the month and surged 32.8% year-on-year.
In the wider 27-nation European Union, industrial new orders grew 2.4% in June and rose 22.5% annually.
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