Euro Area: Industrial production contracts in December
Industrial output decreased 1.1% over the previous month in seasonally adjusted terms in December, contrasting November’s 1.4% increase. December’s result reflected downturns in the production of intermediate, capital and non-durable consumer goods, as well as a sharper contraction in the production of durable consumer goods. However, the production of energy rebounded.
Looking at the individual economies for which data is available, industrial output contracted in 11 countries, while it expanded in seven and remained stable in one. Focusing on the most important economies, production decreased in Germany, while it increased in France, Italy, the Netherlands and Spain.
On an annual basis, industrial production fell 1.7% in December, contrasting November’s 2.8% increase. Lastly, annual average growth in industrial production eased to 0.9% from November’s 1.2%.
Commenting on the outlook, Bert Colijn, senior economist at ING, stated:
“From here on, the question is which factors will dominate: is it the energy crisis or the rebound after persistent supply chain problems? The rebound is set to fade somewhat, but the energy crisis has also entered a milder phase. For now, however, we don’t see much evidence of production rebounds in energy-intensive sectors, which makes us skeptical of a rebound in activity. Given continued weak demand and supply side problems, we cannot expect much more than a path of stagnation for industry. A rebound is too much to ask for at the moment.”