German industrial production beats forecasts in August

Industrial production in Germany bounced in August thanks to large increases in energy and manufacturing sector output.

Total industrial production grew by 2.5% month-on-month according to the Federal Statistics Office.

Economists had anticipated a rise of 1.0% over the month.

July´s -1.5% drop was unrevised.

Manufacturing output led gains, rising by 3.3% over the month while that of the energy sector increased 1.1%, although output in the construction sector dropped 1.2%.

Output of motor vehicles was especially robust, rising by 6.9% over the month.

By industry groups, investment goods sported the most growth, with output up by 4.7% against July, consumer goods production rose 3.3% and that of intermediate ones by another 1.6%.

Friday´s data led economists at Barclays Research to bump up their projection for the rate of growth in German gross domestic product in the third quarter by one tenth of a percentage point to a quarterly rate of 0.4%.

Nonetheless, they expected a slowdown to a 0.3% quarter-on-quarter pace to materialise in the last quarter of the year as a result of the slowdown in the UK, which would impact the euro area´s largest economy via trade and investment.