Euro zone in­dus­trial pro­duc­tion dips

The Pak Banker - - BUSINESS -

BRUS­SELS: In­dus­trial out­put in the 19 coun­tries shar­ing the euro fell by more than ex­pected in June, as ac­tiv­ity in the cur­rency bloc's main economies of Ger­many, France and Italy fell markedly.

The Euro­pean Union's sta­tis­tics of­fice Euro­stat said in­dus­trial pro­duc­tion in euro zone fell by 0.4 per­cent month-on-month in June, but was still 1.2 per­cent higher year-on-year. This was be­low an­a­lysts' ex­pec­ta­tions of a 0.2 per­cent fall. The agency up­wardly re­vised its read­ing for May to a 0.2 per­cent de­cline from a fall of 0.4 per­cent pre­vi­ously pen­ciled in. The slow­down in June was most pro­nounced in the euro zone's main economies Ger­many, France and Italy, while the rate of de­cline slowed in Ire­land and Greece. In Fin­land, the Nether­lands, Slo­vakia and Spain in­dus­trial pro­duc­tion in June was stronger than in May.

While ser­vices are the largest con­trib­u­tor to growth in the euro zone, in­dus­trial pro­duc­tion is very im­por­tant be­cause of its large in­di­rect im­pact on other sec­tors. The largest fall in out­put came for fac­to­ries in the durable con­sumer goods and cap­i­tal goods sec­tor. Energy re­cov­ered from a se­ries to falls in pre­vi­ous months to be­come the most im­proved sec­tor. First es­ti­mates of eco­nomic growth in the euro zone are due on Fri­day, with an­a­lysts on av­er­age ex­pect­ing growth of 0.4 per­cent quar­ter on quar­ter, ac­cord­ing to Reuters data.

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