German industrial output rose in the first month of 2010

03-09-2010 09:57

German industrial output increased in the first month of this year on the back of energy production rising strongly during the harsh winter, compensating a downfall in construction activity.
Industrial output increased 0.6% in comparison to the 1% decline in December, according to the Federal Ministry of Economics and Technology. The median of 36 forecasts showed that economists had predicted a 1% increase for the initial month of 2010. In the yearly comparison, industrial output gained 2.2%, corrected for the number of work days.

German economy

The recovery of the German economy stagnated in the final quarter of last year, and the chilliest winter in 14 years had a negative impact on the first months of 2010. However, factory orders rose by 4.3% in January. Germany’s central bank believes that the economy of the bloc’s wealthiest country will grow by 1.6% this year, following a 5% shrink last year, which was the most extensive contraction since the Second World War.
Carsten Brzeski, an economist at ING Group in Brussels, commented: “The first signals are optimistic after the cold winter. Growing orders prove the positive prospects for the industrial production.”

Euro

Europe’s Single Common Currency hardly changed after the figures and reached a level of $1.3654 at 12:10 p.m. in Frankfurt, as it declined 10% since late November, driving export returns.

Production

Construction activity dropped 14.3% in January in comparison to December, today’s figures demonstrated. That’s the worst plunge since April 2006. Energy production increased 8.8%, while basic goods output jumped 3.3%. January’s production gained 0.9%.

Factory orders

The Federal Ministry of Economics and Technology reported that increasing factory orders yet failed to boost production figures. Economic activity will probably rise as construction is due to improve, according to the Ministry.

Daimler AG

Daimler AG, the world’s thirteenth largest car manufacturer, forecasts the Mercedes-Benz brand to extend its market share in 2010, due to increasing sales, mainly in China, which indicates ‘sturdy’ initial months, according to the leading producer of premium cars and commercial vehicles.

German exports

In 2009, 14% of German exports went to Asia, which means it’s the second largest export destination after the EU, proved by figures provided by the Economy Ministry.

Asian countries

Gerd Hassel, an economist at BHF Bank AG in Frankfurt, noted: “The steadily expanding Asian countries are bolstering German trade. Increasing joblessness has a negative impact on domestic demand. The German economy shows a traditional development.”