The 1% increase in new orders in August and the sharp rebound in the ifo-test business climate in September suggest that the stagnation seen in industry for a number of quarters is probably now over. A key factor is likely to have been foreign demand that on average in July/August was no less than 2.5% up on the average second quarter level. Apart from the ongoing moderate upward trend in the eurozone, German exporters are also benefiting from the economic stabilization in a number of important emerging markets. With real household income still rising strongly and boosting domestic demand, economic growth in the second half of 2016 will probably not slow down as much as some had feared. Economic growth of 2% or more in 2016 is by all means within reach.