Germany: Industrial output falls in February
The industrial sector remained in a tough spot midway through the first quarter as output fell 1.6% month-on-month on a calendar-adjusted basis in February, following January’s 2.0% contraction. The print came on the back of falling capital goods and intermediate goods as well as a contraction in energy production and construction activity. On the other hand, consumer goods output rose, albeit marginally, and softened the fall.
On an annual basis, industrial production dived 6.4% in February, down from January’s 4.0% fall.
Carsten Brzeski, global head of macro at ING, commented:
“February industrial data makes it hard to see how the economy could still escape a contraction in the first quarter. […] In fact, it would need an explosion of manufacturing and construction activity in March to prevent the German economy from falling into contraction in the first quarter of the year. Industrial production is currently stable compared with the fourth quarter, but the construction sector alone would contribute to a drop in GDP by more than 0.5%.”