German Industrial Output Growth Tops Expectations

(RTTNews) - Germany's industrial production grew more than expected in May despite geopolitical tensions and elevated energy prices, raising hopes of gradual economic recovery.

Industrial output advanced 0.9 percent on a monthly basis, faster than the 0.2 percent rise in April. A similar faster growth was last seen in September. Output was expected to grow marginally by 0.1 percent.

Excluding energy and construction, industrial output was up 0.8 percent from April. Capital goods output climbed 1.3 percent and that of consumer goods rose 1.2 percent. Meanwhile, intermediate goods output dropped 0.4 percent.

Energy production increased 0.8 percent and construction registered a 0.9 percent expansion.

On a yearly basis, industrial production remained flat in May after falling 0.9 percent in April.

Data released on Monday showed that factory orders expanded 1.9 percent on a monthly basis in May, in contrast to the revised 3.2 percent decrease in April.

Carsten Brzeski, an economist at ING, said industrial production is defying recession fears as optimism is gradually returning to Germany.

The economist noted that ongoing fiscal stimulus for infrastructure and defense, and the narrative for German growth turns more optimistic. Brzeski observed that developments of the last weeks have provided tentative signs of optimism - for a change.