8 May 2015
German Industrial Production disappoints in March – ING
FXStreet (Barcelona) - Reviewing the German industrial production data release, Carsten Brzeski of ING, views that today’s data has created uncertainty over the country’s growth outlook.
Key Quotes
“The German economy is still struggling to meet the high expectations, created by buoyant sentiment indicators. The latest batch of industrial data provides some food for pessimists. Even if the available monthly data still points to a solid growth performance in the first quarter, albeit at a slower pace than the impressive 0.7% QoQ of the final quarter of 2014.”
“Industrial production disappointed in March, dropping by 0.5% MoM. On the year, industrial production was down by 0.1%. The drop was mainly driven by weaker production of capital and intermediate goods.”
“The only upside was the construction sector with an increase of 2.1% MoM. At the same time, exports increased by 1.2% MoM in March. As imports increased by 2.4% MoM, the seasonally-adjusted trade balance narrowed somewhat to 19.3bn euro, from 20bn euro in February.”
“With today’s batch of industrial data, the pea counting can start again. Next week Wednesday, the first estimate of Q1 GDP growth will finally be published. Today’s data have created uncertainty, rather than clarity.”
“The German growth picture seems to be more mixed than buoyant sentiment indicators have been suggesting. Industrial production is clearly stagnating, reflecting still weak demand from other Eurozone countries but also a continued investment drought. At the same time, net exports should not have been a strong growth driver in the first quarter.”
“This leaves the German economy only with consumption and strong activity in the construction sector as significand growth drivers for Q1 GDP growth.”
“We stick to our forecast of 0.4% QoQ. Looking ahead, the German economy should gain further momentum. Up to now, particularly the weaker euro has not yet shown its full impact on the economy. This should change.”
Key Quotes
“The German economy is still struggling to meet the high expectations, created by buoyant sentiment indicators. The latest batch of industrial data provides some food for pessimists. Even if the available monthly data still points to a solid growth performance in the first quarter, albeit at a slower pace than the impressive 0.7% QoQ of the final quarter of 2014.”
“Industrial production disappointed in March, dropping by 0.5% MoM. On the year, industrial production was down by 0.1%. The drop was mainly driven by weaker production of capital and intermediate goods.”
“The only upside was the construction sector with an increase of 2.1% MoM. At the same time, exports increased by 1.2% MoM in March. As imports increased by 2.4% MoM, the seasonally-adjusted trade balance narrowed somewhat to 19.3bn euro, from 20bn euro in February.”
“With today’s batch of industrial data, the pea counting can start again. Next week Wednesday, the first estimate of Q1 GDP growth will finally be published. Today’s data have created uncertainty, rather than clarity.”
“The German growth picture seems to be more mixed than buoyant sentiment indicators have been suggesting. Industrial production is clearly stagnating, reflecting still weak demand from other Eurozone countries but also a continued investment drought. At the same time, net exports should not have been a strong growth driver in the first quarter.”
“This leaves the German economy only with consumption and strong activity in the construction sector as significand growth drivers for Q1 GDP growth.”
“We stick to our forecast of 0.4% QoQ. Looking ahead, the German economy should gain further momentum. Up to now, particularly the weaker euro has not yet shown its full impact on the economy. This should change.”