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在线翻译:
szdaily -> World Economy -> 
‘Scary’ German output figures for June propel recession fears
    2019-08-08  08:53    Shenzhen Daily

GERMAN industrial output fell more than expected in June, driven by weaker production of intermediate and capital goods, adding to signs that Europe’s biggest economy contracted in the second quarter as its exporters got caught in trade disputes.

Industrial output dropped by 1.5 percent on the month, a far steeper decline than the 0.4 percent fall that had been forecast, figures released by the Statistics Office showed yesterday.

“The continued plunge in production is scary,” Bankhaus Lampe economist Alexander Krueger said, adding that a recession in the manufacturing sector was likely to continue due to the escalation of the trade dispute between China and the United States.

Both countries are important export destinations for German companies, which means that the tit-for-tat tariff dispute between the world’s two largest economies is also having a disproportionately large impact on Germany.

“The longer this continues, the more likely it is that other sectors of the economy will be dragged into this. Growth forecasts for Germany are likely to be trimmed further,” Krueger said.

In the second quarter, industrial output fell by 1.8 percent on the quarter, driven by steep drops in metal production, machinery and car manufacturing, the economy ministry said.

“Industry remains in an economic downturn,” the ministry said. Production in construction fell 1.1 percent in the second quarter while energy output dropped 5.9 percent in the same period.

The figures came after German industrial orders Tuesday exceeded expectations in June, but the economy ministry cautioned that this sector of the economy had not yet reached a turning point.

“This supports our expectation that the German real GDP shrank slightly in the second quarter,” Commerzbank economist Ralph Solveen said on the industrial output figures.

“Despite the increase in orders reported yesterday, the downward trend in production is likely to continue in the coming months, so that manufacturing remains the weak spot of the German economy.”

The German economy is widely expected to have at best stagnated in the second quarter, and sentiment indicators suggest it could shrink in the third as exporters are hit by trade disputes, Brexit uncertainty and a slowing world economy. (SD-Agencies)

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