Eurozone industrial production hits growth outlook

Preliminary euro area gross domestic product (GDP) data for the second quarter is due at 10 a.m. London time Friday.

Industrial production – which is mostly composed of the manufacturing sector, but also mining and quarrying – was 0.4 per cent lower in June than in May, according to figures released by Eurostat today. But it was below the analyst consensus forecast of 0.5 percent.

The euro zone’s year-on-year increase of 1.2 percent in industrial production was due to production of non-durable consumer goods rising by 2.5 percent, capital goods by 1.7 percent, intermediate goods by 0.2 percent and durable consumer goods by 0.1 percent, while production of energy remained stable.

Growth was lower than analyst consensus estimates in both areas.

Did the eurozone economy shift down a gear in the second quarter, as some economists fear, or did it manage to hold on to its modest first-quarter performance?

Traders also eye U.S. reports on producer prices, industrial production and consumer sentiment later in the day to determine whether the Federal Reserve is still on track for a rate hike in the near future.

Seasonally adjusted GDP rose by 0.4% in the in the EU28, compared with the previous quarter. With industry accounting for around 20% of gross value added, this will weigh on second-quarter GDP growth, she said.

The wider European Union fared slightly better, however, with quarterly growth of 0.4% and year-on-year growth of 1.6%.

But Eurostat said month-on-month industrial production fell in the EU and the euro zone, down 0.2 percent and 0.4 percent respectively.