German industrial output posts shock fall in November
By Frank Prenesti
Date: Tuesday 09 Jan 2024
(Sharecast News) - German industrial production registered an unexpected fall in November, making it the six straight month of declines as manufacturing in Europe's biggest economy continued to struggle.
Production fell 0.7% on a monthly basis, well below consensus estimates of 0.2%. The annual decrease was 4.8%, the Federal Statistics Office said on Tuesday.
Activity in the construction sector declined 2.9% month on month. Data for October was revised to a 0.3% decline in industrial output on the month, instead of a 0.4% drop.
Industrial production is now more than 9% below its pre-pandemic level, almost four years since the start of the Covid-19 pandemic.
"Looking ahead, the nearer-term picture of German industry gives very little reason for optimism. The order book deflation of the last two years leaves clear marks as well as ongoing energy and policy uncertainty," said analysts at ING.
"With a soft or hard landing of the US economy and still very little positive growth momentum in China, external demand for German industrial production is likely to remain weak. The only upside could come from a turning of the inventory cycle."
"However, even though there are some very tentative signs of inventory reduction, it would still take until late spring before we could see a significant impact on actual production."
Reporting by Frank Prenesti for Sharecast.com
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