Berlin – Saba:
The German Federal Statistical Office announced on Thursday that German manufacturing companies recorded a 1.9% month-on-month decline in production in June. This represents the lowest level since May 2020, when production collapsed due to the COVID-19 pandemic.
The office reported that production was unexpectedly weak in May, revising previous data to show a 0.1% decline after a previous report indicating a 1.2% increase.
It explained that this exceptionally large revision is due to corrective reports from some companies in the automotive sector. The office also revised industrial production data for May to show a sharp and unexpected year-on-year decline of 3.6%.
The office noted that the decline in production in the pharmaceutical industry was particularly severe, with a decline of 11% month-on-month in June. Production in the machinery sector also declined by 5.3%, while the energy sector recorded an increase that month. The German Ministry of Economics stated in a statement that the weak growth in industrial production in the second quarter is likely to be partly a reflection of the adverse effects of the announced tariff increases.
It noted that due to the US tariffs, no impetus for a sustained recovery in the industrial economy is expected even at the beginning of the third quarter.
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