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German industrial output falls more than expected in June

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German industrial output falls more than expected in June
FILE PHOTO: Employees of German car manufacturer Porsche work chassis at the Porsche factory in Stuttgart-Zuffenhausen, Germany, January 26, 2018. REUTERS/Ralph Orlowski/File Photo   -   Copyright  Ralph Orlowski(Reuters)
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BERLIN (Reuters) – German industrial output fell more than expected in June, data showed on Tuesday, suggesting that factories in Europe’s largest economy ended the second quarter on a weaker footing.

Data from the Economy Ministry showed industrial output dropped 0.9 percent, undershooting a Reuters forecast for a fall of 0.5 percent. That came after a downwardly revised rise of 2.4 percent in May.

In the April-June period, industrial output rose by 0.4 percent on the quarter, the ministry added.

“That’s not a great result but it could have been worse,” Bankhaus Lampe economist Alexander Krueger said.

“In contrast to the first quarter, industrial production supported growth in the second quarter,” Krueger added.

A sector breakdown showed manufacturing fell by 0.8 percent and construction dropped by 3.2 percent in June. Energy production jumped by 2.9 percent.

The Federal Statistics Office will publish preliminary gross domestic product growth data for the second quarter next Tuesday.

Analysts polled by Reuters expect Germany’s quarterly growth rate to pick up to 0.4 percent from 0.3 percent in the first three months of the year.

The Federal Statistics Office said in a separate statement that seasonally adjusted exports were unchanged on the month in June while imports rose by 1.2 percent.

The seasonally adjusted trade surplus narrowed to 19.3 billion euros from an upwardly revised 20.4 billion euros (£18.24 billion) in May.

In the first half of the year, the trade surplus was nearly unchanged at 121.5 billion euros after 121.3 billion euros in the first six months of the previous year, unadjusted data showed.

(Reporting by Michael Nienaber; Editing by Michelle Martin and Raissa Kasolowsky)

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