German bunds slump despite fall in October industrial production, lower-than-expected Eurozone Q3 GDP

The German bunds slumped during European session Friday despite a fall in the country’s industrial production for the month of October and Eurozone’s lower-than-expected gross domestic product (GDP) for the third quarter of this year, released today.

The German 10-year bond yields, which move inversely to its price, jumped 2 basis points to 0.247 percent, the yield on 30-year note also climbed 2 basis points to 0.892 percent and the yield on short-term 2-year traded 1-1/2 basis points higher at -0.611 percent by 10:40GMT.

According to preliminary data from the Federal Statistical Office (Destatis) in October, output in Germany’s manufacturing sector was 0.5 percent lower than in the previous month in terms of price, season and calendar adjustments. For September, after revision of the preliminary results, there was an increase of 0.1 percent compared to August (provisional value: +0.2 percent).

Further, Germany’s industrial production fell by 0.4 percent in October compared with the previous month. Within the industrial sector, production of capital goods increased by 0.3 percent and intermediate goods by 0.2 percent. The production of consumer goods declined by 3.2 percent. Outside of industry, energy production in October 2018 was 3.2 percent lower than in September, while construction output was down 0.3 percent.

Eurozone’s seasonally adjusted GDP rose by 0.2 percent in the euro area (EA19) and by 0.3 percent in the EU28 during the third quarter of 2018, compared with the previous quarter, according to an estimate published by Eurostat, the statistical office of the European Union. In the second quarter of this year, GDP had grown by 0.4 percent in the euro area and by 0.5 percent in the EU28.

Compared with the same quarter of the previous year, seasonally adjusted GDP rose by 1.6 percent in the euro area and by 1.8 percent in the EU28 in the third quarter of 2018, after +2.2 percent and +2.1 percent respectively in the previous quarter.

Meanwhile, the German DAX slumped 2.29 percent to 10,942.61 by 10:45GMT, while at 10:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at -17.13 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex