FRANKFURT (AFP) – German industrial production unexpectedly fell in May, official data showed yesterday, fuelling concerns that a tentative recovery in Europe’s largest but beleaguered economy is losing steam.
Output dropped 2.5 per cent month-on-month, federal statistics agency Destatis said, after a slight increase in April.
Analysts surveyed by financial data firm FactSet had expected an increase of 0.2 per cent in May.
Hit by high inflation, a manufacturing slowdown and weakness in key trading partners, Germany was the only major advanced economy that shrank in 2023.
At the start of the year a string of indicators had suggested a recovery was gaining momentum but in recent weeks those hopes have been tempered by less positive data.
“As the second half of the year has just started, optimism has given way for more realism,” said ING economist Carsten Brzeski.
“The German economy is losing steam again.”
In May’s factory output data, there were heavy falls in construction, which was down 3.3 per cent, the auto sector, which was down 5.2 per cent, and other sectors including electrical equipment and mechanical engineering.
