German industrial production falls in April

Manufacturing firms have been hard hit in Germany's export-oriented economy, suffering from both the threat of a trade showdown between the US and the European Union, plus a full-blown tariff conflict between US and China.
Manufacturing firms have been hard hit in Germany's export-oriented economy, suffering from both the threat of a trade showdown between the US and the European Union, plus a full-blown tariff conflict between US and China.PHOTO: AFP

BERLIN (AFP) - Industrial production in Europe's powerhouse economy Germany fell back in April, official data showed on Friday (June 7), in the latest sign manufacturers are suffering from global uncertainty and trade wars.

Output at producer firms fell 1.9 per cent compared with March, federal statistics authority Destatis said in figures adjusted for price, seasonal and calendar effects - the first drop since January.

"This is a horrible start to the second quarter for German industry," said ING bank economist Carsten Brzeski.

"It now needs even stronger domestic demand and a bounceback in May and June to avoid a return to recessionary territory."

A sector-by-sector breakdown showed production of capital goods fell most sharply, at 3.3 per cent.

Producer goods makers reported 2.1 per cent lower output, while consumer goods firms shed 0.8 per cent.

Energy generation was also down, at 1.1 per cent, while construction output grew slightly.

Manufacturing firms have been especially hard hit in Germany's export-oriented economy, suffering from both the threat of a trade showdown between the US and the European Union, plus a full-blown tariff conflict between the White House and Beijing.

Thursday had brought some relief with firms reporting an April rise in industrial orders - an indicator of future manufacturing output - but they remain at levels well below the same period last year.

"We should continue to expect muted activity in industry over the coming months," the federal economy ministry in Berlin said in a statement.