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16 Jun, 2023 05:38

Eurozone industrial output weaker than expected – Eurostat  

The single-currency area remains in a "stagnation environment" after two quarters of negative growth  
Eurozone industrial output weaker than expected – Eurostat   

Industrial production in the eurozone rebounded slightly in April after a slump in March, the European Union's statistics office Eurostat said on Wednesday. However, the bounce back was weaker than expected, indicating underlying risks for the economies of the 20 countries sharing a common currency.

Industrial output in the eurozone rose 1% month-on-month in April and by 0.2% on an annual basis, while economists had expected 0.8% monthly and annual increases.

Analysts have attributed the figures to a surge in output of capital goods, such as buildings and equipment, that has offset reduced production of consumer goods. At the same time economists warn that the underlying data for the whole euro area looks worse as growth was mainly driven by a 21.5% increase in Ireland.

Meanwhile, major economies in the zone experienced weak output in April. German production was flat according to Eurostat, and France posted a 0.8% increase, while Italy, Spain and the Netherlands faced contractions of 1.9%, 1.8% and 3.5% respectively.

The steepest declines were registered in Slovenia (7.9%), Portugal (5.5%) and the Netherlands (3.5%).

According to economic and financial analysis think-tank ING, the insignificant rise in the eurozone's production in April leaves industrial output "well below the first-quarter average."

"Given that May surveys of the sector continue to be downbeat, it is likely that production will contract on the quarter," ING said, adding that the eurozone remains in a "stagnation environment." Economic recovery is not expected in the second quarter of the year after six months of negative growth, the report concluded.

For more stories on economy & finance visit RT's business section

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