German Industrial Production drops sharply by 4% MoM in August

Dhwani Mehta FXStreet

Industrial Production in Germany showed a bigger-than-expected drop in August, the official data showed on Thursday, suggesting that the recovery in the manufacturing sector losing momentum.

Eurozone’s economic powerhouse’s industrial output drops sharply by 4% MoM, the federal statistics authority Destatis said in figures adjusted for seasonal and calendar effects, vs. a 0.4% drop expected and 1% last.

On an annualized basis, the German industrial production rose by a mere 1.7% in August versus 11.4% expected and a 6% growth reported in July.

FX implications

The shared currency shows little reaction to the downbeat German industrial figures.

At the time of writing, EUR/USD is trading at 1.1552, almost unchanged on the day, wavering in an extremely tight range ahead of the US debt ceiling extension vote.

About German Industrial Production

The Industrial Production released by the Statistisches Bundesamt Deutschland measures outputs of the German factories and mines. Changes in industrial production are widely followed as a major indicator of strength in the manufacturing sector. A high reading is seen as positive (or bullish) for the EUR, whereas a low reading is seen as negative (or bearish).

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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