Euro Zone Industrial Production Update
FRANKFURT (Reuters) – Euro zone industrial production rose as expected in November, but this increase was insufficient to offset prior losses. New data from Eurostat on Wednesday indicated that the industrial sector remains in its second year of recession.
Key Highlights
- Monthly Increase: Industrial output in the 20-nation euro area saw a rise of 0.2% in November, following a similar increase in October. This growth is mainly attributed to higher production in the energy and consumer durable goods sectors.
- Yearly Comparison: However, compared to the same month last year, industrial output dropped by 1.9%, remaining well below pre-pandemic levels.
- Ongoing Challenges: The industry is facing considerable challenges due to soaring energy costs, dwindling demand from Asia, intensifying competition, and the difficulties faced by the German auto sector in adapting to changing consumption patterns.
- Outlook: Despite the monthly uptick in production, concerning order figures, particularly from Germany—the largest economy in the bloc—suggest that no significant recovery is anticipated, although the sector may be nearing its lowest point.
- Impact on Growth: This ongoing downturn has been significant enough to push overall German growth negative for 2024 for the second consecutive year, consequently dragging euro zone growth below 1%.
- Performance by Country: Among the euro zone’s major economies, Germany noted the steepest industrial output decline, while France, Italy, and Spain also experienced negative figures.
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