Berlin, Germany (4E) – Industrial production in Germany fell surprisingly in March due to slowdown in construction activity.
Industrial production declined 0.5 percent in March from the prior month, the first decrease in five months, according to a report by Destatis. Production inched up 0.6 percent in February and gained 0.4 percent in January.
Capital goods production posted a 0.2 percent drop and intermediate goods output fell 0.9 percent. Output in construction dropped more significantly by 2.2 percent in March.
Consumer goods producers registered a 0.5 percent gain on the previous month. Energy production improved 1.8 percent.
Stripping out construction and energy, industrial production fell 0.4 percent in March month-on-month.
Overall industrial production rose 3 percent in March on an annual basis, but slower than economists’ forecast of 4.4 percent gain.
Wednesday’s results showed that industrial orders dropped 2.8 percent month-on-month in March, a reversal of the revised 0.9 percent increase in February.
Last month, the Bundesbank said economic growth will slow down in the second quarter after starting strong in the year. The rise in industrial orders led to the strong growth in the first quarter, the central bank said.
The European Commission projected the euro zone’s biggest economy to expand 1.8 percent in 2014 and 2 percent in 2015.