Euro zone May industrial output weak

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Euro zone May industrial output weak

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Euro zone industrial output rose in May, but by far less than expected.

It was up by just 0.1 percent month-on-month and increased four percent compared with the same month last year.

That seems to confirm the economy for the 17 countries using the euro went through a soft patch in the second quarter with declines in production of consumer goods.

The rise in output was driven by a 0.9 percent rise in energy output from April and a 0.6 percent increase for capital goods.

However, durable and non-durable goods production fell by 0.5 and 0.4 percent respectively from the previous month. Output of intermediate goods such as steel was down 0.1 percent.

Of the 14 euro zone countries for which details were supplied, industrial production increased in 11, including the first rise in five months in Greece, and fell in three — Estonia, Italy and Malta.

Jennifer McKeown of Capital Economics said industrial surveys suggested the slowdown was spreading from the periphery to the core of the single currency bloc, not helped by the high level of the euro.

“Given this and the fact that tight fiscal policy will keep domestic spending subdued, the recovery in the wider euro zone economy may soon grind to a near halt,” she said.