By Maria Martinez
(Reuters) -German industrial production unexpectedly fell in November compared to the previous month, the federal statistics office said on Tuesday, marking the sixth monthly decline in a row.
Industrial production fell in November by 0.7% compared to the previous month.
Analysts polled by Reuters had predicted a 0.2% rise.
“The unexpected fall in German industrial production in November shows that companies are increasingly reacting to falling order books,” Commerzbank’s chief economist Joerg Kraemer said.
Industrial orders rose by only 0.3% month-on-month in November, the federal statistics office said on Monday.
The decline was broad-based. The production of capital goods decreased by 0.7% on the month, the production of intermediate goods fell by 0.5% and that of consumer goods by 0.1%.
Outside manufacturing, there was a 3.9% increase in energy production, while production in construction dropped by 2.9% from the previous month.
German industrial weakness appears to be having a knock-on effect in CEE economies linked to the German auto sector.
Hungary’s industrial output fell by an annual 5.8% in November and Czech industrial output dropped by 2.7% year-on-year in November.
The German statistics office revised data for October to a 0.3% decline in industrial output on the month, instead of a 0.4% drop.
The less volatile three-month on three-month comparison showed that production was 1.9% lower in the period from September to November than in the previous three months, the office said.
Industrial production is now more than 9% below its pre-pandemic level, almost four years since the start of Covid-19, said Carsten Brzeski, global head of macro at ING.
Looking ahead, the nearer-term picture of German industry gives very little reason for optimism, he said.
“With a soft or hard landing of the U.S. economy and still very little positive growth momentum in China, external demand for German industrial production is likely to remain weak,” Brzeski said.
(Reporting by Maria Martinez in Berlin and Tristan Veyet in Gdansk, editing by Linda Pasquini and Ros Russell)
