Weaker industrial output in eurozone

EUROZONE INDUSTRIAL production was much weaker than expected in February, data showed yesterday, pointing to slower economic growth in the first quarter and no quick policy tightening from the European Central Bank.

The European Union’s statistics office, Eurostat, said industrial production in the 19 countries sharing the euro fell 0.8 per cent month-on-month for a 2.9 per cent year-on-year rise.

Economists polled by Reuters had expected a 0.1 per cent month-on-month increase and a 3.8 per cent annual gain.

Eurostat also revised upwards its data for January to a 0.6 per cent monthly decline from the previously reported -1.0 per cent and to a 3.7 per cent year-on-year rise from 2.7 per cent.

Industrial production accounts for some 20 per cent of eurozone gross domestic product.

“Weak industrial production figures point to some growth deceleration in the first quarter. While there’s no reason to panic yet, it seems as if GDP growth is already past its peak,” ING economist Peter Vanden Houte said.

The weaker February result was due to falling production in all categories – intermediate goods, capital goods, durable and non-durable consumer goods – except energy, the output of which surged 6.8 per cent on the month after a 1.1 per cent monthly decline in January.