Euro area’s industrial production rises sequentially in May, production to drop in Q2

Euro area’s seasonally adjusted industrial production rose in May. According to the estimates from Eurostat, industrial production rose 0.9 percent sequentially in the month, as compared to the fall of 0.4 percent seen in the prior month. On a year-on-year basis, industrial production dropped 0.5 percent.

Production of non-durable consumer goods rose 2.7 percent sequentially, while, durable consumer goods and capital goods recorded a rise of 2.3 percent and 1.3 percent, respectively. Energy saw a rise of 0.7 percent. On the other hand, production of intermediate goods dropped 0.2 percent sequentially. Among the member states, the highest rises in industrial production were seen in Ireland and France, whereas the largest decreases were seen in Finland.

On a year-on-year basis, production of intermediate goods dropped 2.6 percent, while those of capital goods dropped 0.7 percent. Meanwhile, the production of durable consumer goods rose 0.4 percent, whereas those of energy and non-durable consumer goods rose 0.4 percent and 3.1 percent, respectively. Among member states, the largest falls in industrial production were seen in Malta and Germany, whereas the highest rise was seen in Ireland.

Survey indicators like the manufacturing output PMI indicate towards a renewed weakness in June. According to a Daiwa Capital Market Research report, a drop in production is expected in the second quarter as a while, which would represent the third fall in the last four quarters. With new orders still trending lower, a weak third quarter is expected as well, said Daiwa Capital Market Research.

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