Summary: Euro-zone industrial production continues recovery after huge falls in March, April; monthly figure less than consensus estimate; annual rate still very negative; major euro-zone economies except Italy exceed overall rate.
Following a recession in 2009/2010 and the debt-crisis of 2010-2012 which flowed from it, euro-zone industrial production recovered and then reached a peak four years later in early-2016. Growth rates then fell and recovered through 2016/2017 before beginning a steady and persistent slowdown from the start of 2018. That decline was transformed into a plunge in March and April.
According to the latest figures released by Eurostat, euro-zone industrial production expanded on a seasonally-adjusted basis by 9.1% in June. The increase was less than the 12.0% increase which had been generally expected and less than May’s revised figure of 12.3%. On an annual basis, the seasonally-adjusted growth rate increased from May’s revised rate of -20.4% to -11.9%*.
German and French 10-year bond yields moved uniformly higher on the day. By the close of business, yields on German and French 10-year bonds had both gained 3bps to -0.45% and -0.17% respectively.
Industrial production continued to rebound across all four of the largest euro-zone economies. Germany’s production increased by 10.8% while comparable figures for France, Spain and Italy were 12.9%, 14.5% and 8.2% respectively.