Summary: Euro-zone industrial production up 1.2% in December; noticeably larger than 0.4% expected; annual growth rate speed up to +1.6%; German production up, down in other major euro-zone 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 in more-recent months has generally stagnated.
According to the latest figures released by Eurostat, euro-zone industrial production increased by 1.2% in December on a seasonally-adjusted and calendar-adjusted basis. The rise was noticeably larger than the 0.4% increase which had been generally expected but half November’s 2.4% gain after revisions. The calendar-adjusted growth rate on an annual basis sped up from November’s revised rate of -1.4% to +1.6%.
German and French sovereign bond yields fell moderately on the day. By the close of business, the German 10-year yield had shed 4bps to 0.27% while the French 10-year yield finished 3bps lower at 0.75%.
Industrial production expanded in just one of the euro-zone’s four largest economies. Germany’s production expanded by 1.1% while the growth figures for France, Spain and Italy were -0.2%, -1.0% and -0.6% respectively.