Germany: Industrial output declines for second consecutive month
December 9, 2013
In October, industrial production contracted 1.2% over the previous month in seasonally-adjusted terms. The reading followed the revised 0.7% contraction registered in September (previously reported: -0.9% month-on-month) and contrasted the 0.7% increase the market had expected. The contraction was the result of lower manufacturing production, a sharp deterioration in electricity and energy supply, and a contraction in construction.
Compared to the same month last year, industrial output rose 1.0% in October, which was the highest increase in 19 months. The result came in above the revised 0.6% expansion recorded in September (previously reported: +1.0% year-on-year). As a result of the strong annual figure, the trend continues to point upward, with the annual average variation in industrial production rising from minus 1.3% in September to minus 1.0% in October.
Forecasters polled by FocusEconomics expect that industrial production will contract 0.3% this year, which is down 0.4 percentage points from last month's forecast. For 2014, the panel sees industrial production rebounding to a 2.5% expansion, which is unchanged from last month's projection.
Author: Ricardo Aceves, Senior Economist