German industrial production falls more than expected in May

German industrial production dropped in May amid a global economic slowdown and political uncertainty in Europe.

Production fell 1.3% from the previous month when it increased a revised 0.5%, the Economy Ministry said. It marked the biggest decline in 21 months and was worse than forecasts for zero growth.

The report highlights the challenges German manufacturers are tackling as the commodities sector continues to come under pressure and the global economy slows. Britain's vote to leave the European Union on 23 June could further hurt the German economy as a weaker pound to euro weakens demand for exports.

"May’s sharp fall in German industrial production adds to the evidence that GDP growth in the region’s largest economy slowed sharply in the second quarter," said Capital Economics. "And the recovery looks likely to ease further in the second half of the year."