German Industrial Output & Exports Recover

(RTTNews) - Germany's industrial production and exports rebounded in November but the underlying picture remained pretty grim amid job cuts in manufacturing and the possible hike in trade tariffs by the U.S.

Industrial output increased a more-than-expected 1.5 percent on a monthly basis, in contrast to the revised 0.4 percent decrease in October, data from Destatis revealed Thursday. Output was expected to grow moderately by 0.5 percent.

In the three months to November, industrial production was 1.1 percent lower than in the previous period.

Excluding energy and construction, industrial production grew 1.0 percent from the previous month. Annually, production decreased 3.2 percent.

Data showed that energy production advanced 5.6 percent on month and construction grew 2.1 percent. The manufacture of other transport equipment also had a positive impact.

The production of capital goods moved up 1.4 percent, consumer goods production increased 0.9 percent and intermediate goods output climbed 0.5 percent.

Industrial production was 2.8 percent lower than in November 2023, following a 4.2 percent drop in October. Despite the monthly increase in production, the big picture remains that German industry is struggling, Capital Economics' economist Franziska Palmas said.

Weak manufacturing activity surveys for December and low industrial orders suggest industrial output will remain subdued in the coming months, the economist added.

Data showed that German exports logged a monthly growth of 2.1 percent after October's 2.9 percent decrease. Shipments were forecast to climb 2.0 percent.

On the other hand, the decline in imports worsened to 3.3 percent from 0.3 percent in October. Economists had forecast imports to grow 0.7 percent.

Consequently, the trade surplus increased to EUR 19.7 billion in November from EUR 13.4 billion in October.

ING economist Carsten Brzeski said the rebound in industrial production and exports is a welcome relief, but it will likely come too late to prevent another quarter of stagnation.

Today's increase in production is not an indication of a recovery but it is more of a technical rebound following two months of contraction, he added.