Brandenburg Gate in Berlin, Germany

Germany Industrial production April 2024

Germany: Industrial output drops at a softer rate in April

Industrial output dropped 0.1% in seasonally adjusted month-on-month terms in April, which was a smaller contraction than March’s 0.4% decrease. That said, April’s result fell short of market expectations of a 0.3% expansion. Looking at the details of the release, the improvement largely reflected a rebound in manufacturing sector output and energy supply. In contrast, construction output dropped at a faster clip, and mining and quarrying production swung into a notable contraction.

On an annual basis, industrial production fell at a more moderate rate of 3.9% in April (March: -4.3% yoy). Meanwhile, the trend pointed down, with the annual average variation of industrial production coming in at minus 3.4%, down from March’s minus 3.1%.

Carsten Brzeski, global head of macro at ING, commented:

“There are still several cyclical factors potentially dragging down economic activity. Higher oil prices as a result of the ongoing military conflicts in the Middle East could easily weigh on industry and exports once again. Also, the increasing number of insolvencies and individual company announcements of upcoming job restructurings are not only fuelling the risk of a weakening labour market this year but also argue against a strong industrial rebound. Finally, besides the potential cyclical headwinds, Germany’s well-known structural weaknesses will not disappear overnight and will limit the pace of any rebound.”

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