Auto woes drive dip in German industrial output

Credit: Reuters Studio
Published on March 11, 2019 - Duration: 01:32s

Auto woes drive dip in German industrial output

A plunge in car production drove an unexpected drop in German industrial output in January as Europe's largest economy stuttered amid trade friction and unease about Brexit.

David Pollard reports.

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Auto woes drive dip in German industrial output

An upbeat Monday start for Europe's markets .... As shares recovered on merger talk in the banking sector.

But - with the prospect of downbeat days ahead.

Traders say: no prize for guessing what'll weigh on sentiment.

(SOUNDBITE) (German) HEAD OF SPECIALIST FLOOR EQUITIES AT ODDO SEYDLER BANK, OLIVER ROTH, SAYING: "We will also look at the trade dispute between the United States and China again and of course Brexit is in focus ..." The trade dispute felt here.... Germany's car industry - where production fell 9.2 per cent in January.

With Brexit looming - and the sector facing new emissions regulation - overall industrial output fell 0.8 per cent in Germany.

A half a per cent rise had been expected.

UPSOT (English) OECD CHIEF ECONOMIST, LAURENCE BOONE, SAYING: "Global growth is slowing and Europe is slowing much more than we expected ..." But the figures may come as little surprise after a host of warnings on the global outlook.

From the OECD last week - and from the ECB's policy meeting on Thursday.

SOUNDBITE (English) MARIO DRAGHI, ECB PRESIDENT, SAYING: "We are coming, and, well, maybe we still are, in a period of continued weakness, and pervasive uncertainty." Germany's business daily Handelsblatt, meanwhile, has reported the German government .... as cutting its in-house GDP forecast to just 0.8 per cent for this year.

That would be its second reduction in less than two months.

As for the trade dispute: China's data on Monday shows car sales there fell nearly 14 per cent year on year in February .... The eight consecutive month of decline in the world's largest car market.

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