FRANKFURT: German industrial production and exports both fell in September, official data showed Tuesday, with analysts predicting Britain’s exit from the European Union could inflict further pain.
Industrial production dipped by 1.8 percent corrected for price, seasonal and calendar effects in September compared with the previous month, the federal statistics office Destatis said.
That was a much steeper slide than predicted by analysts surveyed by Factset who had expected a 0.4-percent drop.
The statistics office also revised up the level of month-on-month growth in August, from a 2.5 preliminary reading to 3.0 percent.
Meanwhile, a 0.7 percent fall in exports compared with August, adjusted for seasonal and calendar effects, cut Germany’s trade surplus as it outpaced falling imports.
A statement from the economy ministry in Berlin greeted a “slightly positive picture” of 0.3 percent quarter-on-quarter growth in industrial production over the three months from July to September.
Fewer public holidays in the fourth quarter and a slight pick-up in industrial orders and other economic indicators such as business confidence could point to faster growth in the months ahead, the ministry statement read.
“The falls in September should be seen clearly in the light of the strong growth in August,” analyst Stefan Kipar of BayernLB bank agreed.
“Economic activity is unlikely to lose momentum at the end of the year,” he went on, although “a few clouds are darkening the horizon with the British Brexit trigger in the new year.”
British Prime Minister Theresa May has vowed to launch the UK’s two-year negotiation to quit the European Union by the end of March.
The outcome of the island nation’s in-out referendum in June has already hit German exporters by weakening the British pound, analyst Carsten Brzeski of ING Diba bank said.
“Brexit uncertainty, a mature business cycle and political and economic uncertainty in many important trading partners” would prevent a clear growth trend emerging in German industry in the near future, he argued.