FRANKFURT--German manufacturing orders surprisingly tanked in June, as geopolitical risks weighed on orders, official data showed Wednesday.

The country's economy ministry said orders fell 3.2% in adjusted terms in June from May, compared with a 1.6% decline in May from April. Analysts polled by The Wall Street Journal had forecast a rise of 0.8%.

The ministry said that concerns about geopolitical risks likely held back orders and that this would restrain Germany's industrial economy. "It is thus to be expected that industrial business activity in coming months will develop rather moderately," it said.

The decline was the sharpest since September 2011 and raises concern that political upheaval in Ukraine and sanctions against Russia are weighing on the prospects for German firms. Analysts and surveys have signaled for some months now that German firms are worried about developments both in the east of Europe and in the Middle East.

"Geopolitical tensions are taking their toll on the German economy," the IFO Institute said last month.

Foreign orders were down 4.1% with the sharpest drop coming from the euro zone, where orders fell 10.4%. Orders from outside of the currency bloc were unchanged. Domestic orders were down 1.9%. On the quarter, orders fell by 0.6%.

Write to Todd Buell at todd.buell@wsj.com

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August 06, 2014 04:15 ET (08:15 GMT)

Copyright (c) 2014 Dow Jones & Company, Inc.