Summary: Euro-zone industrial production up 1.0% in February, rise more than expected; annual growth rate accelerates from 1.0% to 2.0%; German, French 10-year yields creep higher; output expands in three of four largest euro economies.
Following a recession in 2009/2010 and the debt-crisis which flowed from it, euro-zone industrial production recovered and then reached a peak four years later in 2016. Growth rates then fluctuated for two years before beginning a steady and persistent slowdown from the start of 2018. That decline was transformed into a plunge in March and April of 2020 which then took over a year to claw back. Production levels in more-recent months have generally stagnated in trend terms.
According to the latest figures released by Eurostat, euro-zone industrial production expanded by 1.5% in February on a seasonally-adjusted and calendar-adjusted basis. The result was more than the 1.0% expansion which had been generally expected and greater than January’s 1.0% after revisions. The calendar-adjusted growth rate on an annual basis accelerated from January’s revised rate of +1.0% to +2.0%.
German and French sovereign bond yields crept a little higher on the day. By the close of business, German and French 10-year yields had both added 1bp to 2.37% and 2.88% respectively.
Industrial production expanded in three of the euro-zone’s four largest economies. Germany’s production increased by 2.1% over the month while the comparable figures for France, Spain and Italy were 1.1%, 0.6% and -0.2% respectively.