Germany Industrial Output Growth Eases More Than Expected
(RTTNews) - Germany's industrial production growth slowed more than expected in May on supply shortages, raising fears of recession, data from Destatis revealed on Thursday.
Industrial production grew 0.2 percent in May from April, when output was up by revised 1.3 percent. Output was expected to climb 0.4 percent.
Within industry, capital goods production gained 2.2 percent, while output of consumer goods and intermediate goods fell 0.9 percent and 0.4 percent, respectively. Excluding energy and construction, industrial production was up 0.6 percent.
Outside industry, energy production decreased 5.8 percent. On the other hand, production in construction grew 0.4 percent.
Year-on-year, industrial output declined 1.5 percent after easing 2.5 percent in April.
This week's macro data were yet another disappointment for the German economy, ING said. The main question is no longer whether the economy could contract this year but rather for how long it will be in recessionary territory.
The small rise in industrial production was not big enough to change the assessment that output in the sector is likely to have declined in the second quarter, Jack Allen-Reynolds, an economist at Capital Economics, said.
The industry is likely to continue to struggle over the rest of the year, with the possibility of further sustained disruption to gas flows from Russia presenting a downside risk, the economist noted. Data released on Wednesday showed that new orders grew only 0.1 percent in May, but reversing a 1.8 percent fall in April.
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