New orders, closely watched as a predictor of future industrial activity, rose by 7.0 percent month-on-month after 6.2 percent in May, federal statistics agency Destatis said.

The indicator again surpassed its level before March, when it fell by 10.9 percent, the biggest monthly drop since April 2020 as the Covid-19 pandemic throttled the economy.

The rebound was a rare ray of light for Germany, which slipped into recession around the start of the year due to surging energy prices, inflation and interest rate hikes that have knocked demand.

“Another big surprise, this time on the upside,” said LBBW analyst Jens-Oliver Niklasch.

“Was the recession in the end only a bad dream? At least the collapse in March is over. We could look to the second half more at ease if the early indicators weren’t so weak.”

June’s rise was driven by “several big orders”, without which the indicator would have fallen by 2.6 percent, the economy ministry said.

The mechanical engineering industry saw a robust 5.1-percent rise in orders, while European aircraft maker Airbus landed the biggest-ever order for civil aircraft with a 500-plane deal from low-cost Indian carrier IndiGo.

Orders for motor vehicles — a key sector of the German economy — watched their steep decline continue with a 7.3-percent drop.

A string of weak economic data has raised fears that the German economic motor was beginning to stall.

The growing headwinds led the country’s top institutes to forecast that the economy will shrink by 0.2 percent over the course of 2023.