German July Industrial Output Remains Flat
07 Septembre 2017 - 9:34AM
RTTF2
Germany's industrial production remained unchanged in July as
the improvement in construction and manufacturing was offset by the
deterioration in the energy sector.
Industrial production showed nil growth following a 1.1 percent
decrease in June, data from Destatis showed Thursday. Output was
forecast to grow 0.5 percent.
Excluding energy and construction, industrial production gained
0.3 percent in July.
Energy production decreased 4.7 percent in July, while
construction output grew 0.5 percent.
Production of capital goods and the production of consumer goods
fell 0.3 percent each. Meanwhile, the production of intermediate
goods showed an increase of 1.4 percent.
Year-on-year, industrial production growth improved to 4 percent
from 2.7 percent. Production was forecast to climb 4.6 percent.
The economy ministry said industrial production lost momentum in
the summer after a very dynamic first half. The indicator suggests
continuation of the upswing but at a slower pace, the ministry
said.
Data released on Wednesday showed that factory orders logged a
0.7 percent drop in July, which was the first fall in three
months.
While production should pick up again in the coming months, the
rather modest order intake trend points to only a gradual upward
movement, Ralph Solveen, Commerzbank analyst said.
Consequently, the surge of the overall economy from the
producing sector should be lower in the third quarter than in the
first half of the year, Solveen noted.
The slowdown in German industry may raise eyebrows at the
European Central Bank's meeting today, and a further rise in the
euro would be a threat to the growth outlook, Jennifer McKeown, an
economist at Capital Economics, said.
But for now, economic prospects seem positive and the ECB is
expected to gradually taper its asset purchases next year, although
it is unlikely to announce its plan today, the economist added.
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