Downbeat UK, German Manufacturing Data Add To Recession Fears
By Hao Li | April 5, 2012 11:50 PM EST
A pair of unexpectedly downbeat economic reports from Germany and the U.K. on Thursday added fueled doubts that manufacturing could lift the region out of its recession.
German industrial output fell by 1.3 percent in February from the previous month, according to the Federal Statistical Office of Germany, undershooting the economists' consensus estimate of a 0.5 percent drop as compiled by Bloomberg News.
January's previously reported gain of 1.6 percent was also revised down to an increase of 1.2 percent.
Germany's construction plunged 17.1 percent while manufacturing production fell 0.4 percent, led by a 2.1 percent decline consumer goods output. The huge drop in construction was exacerbated by the unusually cold weather.
Still, the overall report has "brought further signs that the former engine of the euro zone recovery [manufacturing] has gone sharply into reverse," Jonathan Loynes, Capital Economics' chief European economist, told Agence France-Presse.
U.K.'s Office for National Statistics reported that manufacturing output fell by 1 percent in February from the previous month, below economists' consensus estimate of a 0.1 percent increase as compiled by Bloomberg.
The decline was the biggest since April 2011.
"The U.K. recovery is not to be taken for granted. We maintain our view that the economy will remain fragile during the first half of the year before gaining strength during the second half," said Blerina Uruci, an economist at Barclays, reported Bloomberg News.
From late 2010 to early 2011, manufacturing growth powered the euro zone's recovery from the Great Recession.
However, as the global economy slowed and the euro zone sovereign debt crisis forced austerity measures on peripheral members of the region, recovery stalled and the economy has had two successive quarters of economic contraction.
Recent economic reports, including those from Markit Economics Ltd.'s purchasing managers' index and the Eurocoin economic-activity gauge, confirm the euro zone's current recession.
To contact the editor, e-mail:
Most Popular Slideshows
- George Clooney And Amal Alamuddin's Wedding In Venice: Photos Of Groom And His Family, Friends [Slideshow]
- NFL Recap - Week 4: Green Bay Packers 38, Chicago Bears 17 [PHOTOS]
- NFL Recap: New York Giants 45, Washington Redskins 14 [PHOTOS]
- Photos Of George Clooney And Amal Alamuddin, They Get Married Again On Monday [Slideshow]
Join the Conversation
- 3 Reasons to Get the Samsung Galaxy Note 4 Instead of the iPhone 6
- iPhone 6 vs Moto G 2014: Motorola’s Budget Smartphone Takes On Apple’s Premium Smartphone
- Google HTC Nexus 9 Tablet October 24 Launch Date Benefits Many
- Galaxy Note 4 vs Nexus 6: Which Smartphone Dominates
- MH 370 Search In Ocean To Intensify With Hi Tech Ships Joining The Plane Hunt From October
- Nexus 7 Tips and Tricks
- New Windows OS Is Not Windows 9, Microsoft To Launch Windows 10 As New OS Build