German industrial output drops unexpectedly in June

FRANKFURT AM MAIN: German industrial production declined in June, disappointing analysts’ expectations, official data showed on Monday.

Production fell by 1.1 per cent month-on-month in June, after a 1.2-per cent rise in May, according to figures adjusted for price, seasonal and calendar effects from federal statistics authority Destatis.

The June figure fell short of the 0.25 per cent growth predicted by analysts surveyed by Factset.

Industrial production is closely watched as an indicator of the health of an economy, and has been on the rise in Germany in recent months along with indicators of business, investor and consumer confidence.

Looking at the different industrial sectors, capital goods makers’ output fell 1.9 per cent, while producer goods production was down 1.2 per cent and consumer goods production declined by 0.7 per cent.

Construction output fell 1.0 per cent, while the energy sector was the only ones to report increased production, 1.4 per cent higher than in May.

Despite the fall in June, “the business situation in industry continued to revive in the second quarter,” the economy ministry in Berlin said in a statement, noting that production only sank in June after five consecutive months of increases.

“Industrial orders and indicators for the business climate suggest that the upward trend in industrial production will continue,” the ministry added. — AFP