German Industrial Output In August Increased 3.4%

Things were looking up for Germany in August as industrial production jumped by a surprising 3.4% from the previous month, the German economy ministry reported. The ministry warned however that the upturn might be a temporary development amid the global financial crisis.
Analysts polled by Dow Jones Newswires had forecast that industrial output in the biggest European economy would slip by 0.4% on the month. The figure represented a rare piece of good news for Germany, after Michael Glos with the Economy Ministry said the government would have to revise its growth forecast for 2009 lower owing to the financial crisis.

In July, German industrial output had fallen by 1.6% and it was feared that the economy would fall into recession if it contracted in the third quarter, which ended on August 31.

But while the latest figure, which the ministry said was largely the result of the national vacation calendar, could keep Germany from falling into a technical recession, it was unlikely to be seen again in the following months.

German industrial orders also recorded a surprise increase in orders in August, gaining 3.6% from July after eight successive monthly drops. The economy ministry warned that prospects for the future remained subdued at best. ❖