Industrial production in Germany declines for the second month in a row

Today Statistics Germany reportedthat the index of industrial production in the country in June decreased by 1.5% compared to May and by 1.7% compared to June last year. In May, the index decreased by 0.1% compared to the previous month, and remained unchanged compared to May last year.

The department notes that the decrease was largely due to a decrease in the production of cars (-3.5%), while in May there was an increase of 5.8%. Another driver of the overall decline in the index in June was construction (-2.8%). And the highest growth in June was recorded in the German pharmaceutical industry (+7.9%), while in May this industry showed a decrease of 13.3%.

The June dynamics of industrial production in Germany was worse than the forecasts of analysts surveyed Reuters: They expected a decline of only 1.5% compared to May. “The June minus could mean weak manufacturing data in the coming months,” Commerzbank chief economist Jörg Kremer was quoted as saying. He explains the decline in production by the fact that companies have already exhausted the stock of orders accumulated during the COVID-19 pandemic.

Evgeniy Khvostik