German Industrial Production seasonally adjusted for January came in at -2.5% vs consensus estimates of -0.4% (prev 0.0%) & Industrial Production WDA Jan -3.9% vs estimates of -3.7% (prev -1.0%).
The report said, compared with February 2020, the month before (Jan) restrictions were imposed due to the coronavirus pandemic in Germany, production in January 2021 was 4.2% lower in seasonally and calendar-adjusted terms.
In terms of specifics, production in industry excluding energy and construction was down by 0.5%.
Within the industry, the production of capital goods showed a decrease of 0.8% and the production of consumer goods of 3.0%. The production of intermediate goods increased by 0.7%. Outside the industry, energy production was up by 0.6% in January 2021. Production in construction declined by 12.2% against the background of the strong increase recorded in December 2020 (revised value: +5.4%) and the end of the value-added tax reduction.
Soon we must be looking to see some significant rises. The analyst consensus estimates must have taken into account the fact that Germany was in a lockdown and to come 2.1% below those estimates is shocking. It is clear to see there is much to do in the recovery in Germany. The vaccine count is not as high as countries like the UK so it may be slow progress but orders from China have been picking up. There is a big shortage in semi-conductors and the drop in construction would have inevitably hit the figure but some may be surprised by the extent of the drop. All is left to see how the Q1 GDP will be affected.
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