German Industrial Production down 1.1%
German industrial production went down 1.1 percent month-on-month for the third quarter.
According to Bloomberg Business, Berlin Economy Ministry reported the decline Friday, while economists expected a 0.5 percent increase. Germany has been struggling with the Chinese economic slowdown. The country is also grappling with the economic slowdown in other emerging countries where it exports most of its products.
The BBC News reported that the Ministry said, "After a good development in the first half, German industry is currently experiencing a light headwind from the world economy, in particular due to a slowdown in some large emerging markets." Meanwhile, production in factories went down 0.3 percent from July to September. There is an increase in construction, but it does not fully offset the drop in manufacturing output.
Business Insider reported that Germany has no real back up plan against the decline of international trade. This is not a good precedence considering that the country's economy is led by exports. The Economy Ministry reported Thursday that the manufacturing orders went down 1.7 percent in September. This is the third consecutive time the manufacturing orders went down.
The Germany's surprisingly weak industrial output has prompted economist to decrease their growth expectations for the country. Economists also expect that the slow manufacturing production of the country can adversely affect the country's third quarter growth projection.
However, economist injected a little optimism saying the country's weak economic growth won't totally fall off the cliff as the service sector promises a strong business sentiment.
Meanwhile, the country's Ifo business climate went down October. However, Ifo said business grew upbeat on their trade prospects. There is much demand from the eurozone and the US that will keep Germany's economy going. Healthy private consumption is also an additional factor for the country's economic growth. Preliminary projections for the country's third quarter GDP will be released November 13.