German industrial production drops, exports sink

Industrial production in Germany dropped by more than expected in September, according to figures from Destatis, while the country's trade surplus shrank as exports declined.

Industrial production decreased by 2.5% in September after a revised 2.6% gain in August, the Federal Statistical Office reported on Thursday.

This was much worse than the 1.0% decline expected by the market, and put production 4.6% lower than last year following a 3.0% annual decline the month before.

Destatis said that automotive production tanked 7.8% over September, pulling back sharply after a 15.4% surge in August. Production across the chemical industry also fell 4.3%, while the manufacture of machinery and equipment improved by 1.7%.

As for the trade figures, the German trade surplus shrank more than forecast to €17.0bn in September, from €22.5bn the month before, well below the €20.9bn consensus estimate.

Exports dropped by 1.7% over the month to €128.2bn, with exports within and outside the EU both falling from August. At the same time, imports jumped 2.1% to €111.3bn.