Eurozone Industry December 2015


Eurozone: Deterioration in industrial production surprisingly continues in December

February 12, 2016

Negative news regarding industrial production in the common-currency block appeared in the last month of 2015, when output dropped 1.0% over the previous month in seasonally adjusted terms. The result came in below the revised 0.5% contraction registered in November (previously reported: -0.7% month-on-month) and surprised the markets to the downside as they had expected a rebound in December, with industrial production expected to expand 0.3%.

Looking at the details, December’s deterioration was mainly the result of a sharp contraction in energy production. Less energy output at the end of 2015 stemmed from warmer-than-usual winter weather. Weakness in other industries was also notable in December, with the exception of durable consumer goods. Compared to the same month of the previous year, industrial output fell 1.3% in December (November: +1.4% year-on-year), which represented the first contraction since November 2014 and the fastest drop since August 2013.

Among the Euro area economies, for which data are available, the contraction was driven by a notable decrease in Ireland (-4.3% month-on-month) as well as due to contractions in Lithuania (-3.3% mom) and Estonia (-2.9% mom). Among the region’s major economies, industrial output contracted in all four economies over November, particularly in France and Germany, which fell 1.7% and 1.3%, respectively.

In 2015 as a whole, industrial production expanded 1.4%, which was faster than the 0.8% increase tallied in 2014.

FocusEconomics Consensus Forecast panelists see industrial production expanding 1.9% in 2016, which is down 0.1 percentage points from last month’s forecast. For 2017, panelists also see industrial production growing 1.9%.

Author:, Senior Economist

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Eurozone Industry Chart

Euro Industry by country December 2015

Note: Month-on-month var. of seasonally-adjusted industrial production and annual average growth rate in %. Data for Austria, Belgium and Cyprus refer to November.
Source: Eurostat

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