LIVE UPDATES
Germany, Europe's largest economy, continues to grapple with economic challenges as official data revealed a more significant decline in industrial output than expected for September. Industrial output slipped by 1.4 percent compared to the previous month, reaching its lowest level since August 2020. This marks the fourth consecutive monthly drop and exceeded the 0.3 percent decline forecast by analysts.
A cause for concern is the sharp drop of five percent in the crucial automotive and auto supplier industry. However, there were some areas of growth, including machine manufacturing, which gained 4.1 percent, and the energy-intensive chemicals sector, which saw a modest 0.9 percent growth.
Economists at Capital Economics expressed concern about the outlook, stating that the data suggests "prospects for the winter months look very poor." ING analyst Carsten Brzeski noted that recent developments have increased the risk of Germany ending the year in a recession.
Several factors have contributed to headwinds for Germany's industrial sector, including inflation, high energy prices, and the impact of a weakening Chinese economy, which has affected the nation's exports. Germany faced a recession at the beginning of the year and experienced stagnation in the second quarter. The country has been grappling with a string of weak economic data, raising concerns about a prolonged economic downturn. The International Monetary Fund has predicted that Germany will be the only major advanced economy to contract this year.
