German production declines in September

German industrial production in the third quarter declined 0.3 per cent from the previous quarter led by a 0.5 per cent drop in manufacturing output, it said.

In the less volatile three-month comparison, factories produced 0.3 per cent fewer goods on the quarter in the July-September period, with an increase in construction failing to fully offset a fall in manufacturing output.

United Kingdom industrial production declined in September, while manufacturing output growth doubled from August, data from the Office for National Statistics showed Friday.

Germany’s export industry has been hit hard by the slowdown in China and other developing markets this year.

“The Chinese and emerging market slowdown are also leaving their marks on the eurozone’s largest economy”, said Carsten Brzeski, chief economist at ING-Diba bank in Frankfurt. In September, factory production declined 1.4% from the previous month. It was expected to fall marginally by 0.1%. “Companies have reined in production somewhat in light of the modest development of manufacturing orders in the third quarter. Business confidence in the industry remains good and speaks in favour of a temporary weak phase”.

“The poor September data indicate industrial output likely fell 0.2% quarter-on-quarter in the third quarter, following a 0.2% rise in the second quarter, further increasing downside risks for the third quarter GDP release next week, but final revisions can still change this downbeat estimate”.