Eurozone industrial production recovered in August, mainly due to a recovery in capital goods and consumer durables production, according to data released by Eurostat on Tuesday.
Industrial production recorded a 1.8% month-on-month increase in August, reversing the 0.5% decline seen in July. Growth was as expected.
Elias Hilmar, an economist at Capital Economics, said that although industrial production growth was the strongest in a year, it was probably not the beginning of a sustained recovery.
The economist added that production is likely to decline for the rest of the year.
ING economist Bart Collin said improving inventory cycles was likely to be a hot topic next year. “For manufacturing, this means we cannot expect a sustained recovery to begin before 2025,” Colin said.
Capital goods production increased by 3.7%, offsetting a 1.3% decline in the previous month. At the same time, durable consumer goods production increased by 1.7% after decreasing by 3.1%.
Similarly, energy production increased by 0.4%, compared to a 0.2% decline in July. The rate of decline in intermediate goods production slowed from 1.3% to 0.3%.
Meanwhile, growth in non-durable consumer goods production slowed from 1.8% to 0.2%.
On an annualized basis, euro zone industrial production unexpectedly rose by 0.1%, following a 2.1% decline in July. Economists had expected a 1.2% decline from the previous month.
Industrial production in the EU27 rose by 1.3% month-on-month in August and by 0.2% compared to the same month last year.
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