Monday, April 07, 2008

German Industrial Production February 2008

German industrial production rose again in February, for its third monthly gain in as many months, as manufacturing output continued to hold up and unusually warm temperatures boosted construction. Output rose a seasonally adjusted 0.4 percent from January, when it gained 1.4 percent, the Economy Ministry in Berlin said today. Year on year total industrial production was up 6.1 percent when adjusted for the number of working days.

Construction output rose 3.7 percent in February from the previous month, today's report showed. Manufacturing production increased 0.3 percent and output of semi-finished goods rose 1.6 percent. Investment goods production declined 0.2 percent. January's gain in output was revised down from 1.8 percent. Relatively mild weather has allowed construction companies to work during much of the winter. At 3.6 degrees Celsius the average temperature in February was 3.3 degrees higher than the long-term average, according to the Offenbach-based German weather service DWD.

In a two-month comparison, which smoothes out monthly volatility, industrial production increased 2.4 percent in January and February from the previous two-month period.

German industry still seems to be working off the huge batch of orders which built up during the fourth quarter, but more than likely we'll see a slowdown over the coming months as global demand is cooling an the euro remains strong. As a possible early warning of this factory orders fell 0.5 percent in February, a government report showed last week, while the International Monetary Fund has cut its 2008 outlook for economic growth in Germany to 1.4 percent from 1.5 percent.

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