Eurozone industrial production falls unexpectedly in June | business | Hindustan Times
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Eurozone industrial production falls unexpectedly in June

business Updated: Aug 13, 2014 16:20 IST
Industrial production

Industrial production in the eurozone fell by 0.3% in June, official data showed on Wednesday, dragged lower by a drop in the output of consumer goods and energy.

The result was significantly below analyst expectations, and the news — the latest sign that recovery of the eurozone economy is faltering — pushed down the euro against the dollar.

Analysts had expected expansion of 0.3% for the period, and the data followed a 1.1% fall a month earlier.

Over 12 months, production in the 18-country bloc was flat.

"This is a very disappointing figure after the already strong contraction in May (caused by additional holidays in some countries)," said analyst Peter Vanden Houte from ING Bank in Brussels.

"For the quarter as whole, industrial production contracted by 0.4%, which doesn't bode well for second quarter GDP growth to be published tomorrow (on Thursday)... a growth figure of 0.2% now seems to be out of reach," he added.

The drop-off in production was caused mainly by a 1.9% drop from non-durable goods and a 0.7% fall in energy.

"Looking ahead, survey measures continue to point to only sluggish industrial production growth at the start of Q3, adding to signs that the wider euro-zone recovery may have already peaked," said Jessica Hinds of European economist for Capital Economics.

Broken down by country, the strongest drops were seen in the eurozone periphery with a sharp drop of 16.5% in Ireland. The Netherlands fell off by 3%.

Germany eked out a gain of 0.2%, while France rose by 1.2%. Across the 28-country EU, industrial production fell by 0.1%, and gained 0.7% over 12 months.