Euro Area: Industrial production rebounds in May

Euro Area Industry May 2020

Euro Area: Industrial production rebounds in May

Industrial output expanded a seasonally-adjusted 12.4% over the previous month in May, sharply contrasting April’s 18.2% contraction and marking the strongest jump on record.

May’s rebound was underpinned by surging production of durable consumer goods and a notable increase in the production of capital goods. Moreover, the manufacturing of intermediate goods grew robustly, while the production of non-durable consumer goods and energy rose at a much softer pace.

Looking at the individual economies for which data is available, industrial production expanded in 12 countries, while it dropped in four countries. Heavyweights Germany, France, Italy and Spain recorded significant increases, with industrial production in Italy soaring over 40%. At the same time, output dropped in Estonia, Finland, Ireland and the Netherlands.

On an annual basis, industrial production nosedived 20.9% in May, following April’s record-sharp 28.7% slump. Lastly, annual average variation in industrial production fell to minus 6.7% from April’s minus 5.1%.

Commenting on the release, Bert Colijn, Eurozone senior economist at ING, stated:

“All in all, the big numbers in May don’t tell us all that much yet about the actual state of eurozone industry. June will probably still experience a boost from reopening and with about 20% less output than before the crisis, it is important that it does. The rapid recovery will fade out though and if orders do not return quickly, many businesses will continue to struggle. That leads us to believe that there is still a long road ahead towards full recovery.”

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