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
- Kate Middleton First Official Solo Trip: Details For Malta Tour Revealed [PHOTOS]
- 2014 MTV Video Music Awards: Full List Of Winners, Miley Cyrus ‘Wrecking Ball’ Bags Video Of The Year [PHOTOS]
- Manny Pacquiao Vs. Chris Algieri World Tour Kick Off Press Conference In Macau [PHOTOS]
- Kate Middleton’s Mom Accused Of Being A Social Climber, Prince George Not Seen By Relatives
Join the Conversation
- ISIS Posts Threats On Twitter, Works Around California Earthquake Hashtags, Pressures US To Respond To #StevensHeadinObamasHands
- Iceland Volcano: Bardarbunga Stricken by 5.7 Magnitude Earthquake But Still No Eruption, Magma Could be Going Elsewhere
- United Airlines Flight Diverted as Passengers Fought Over Anti-Seat Reclining Device
- Chicago Marathon Brings Over $253 Million in Business
- New Zealand's High Growth Rate Predicted To Fall When Christchurch Rebuild Halts
- Apple on iPhone 6 Release Date One Week After September 9 Despite Display Shortage Starting $800
- James Foley Video Had A Change Of Actor – Expert Points Out
- Canada Concerned About Russia’s Military Expansion in Arctic
- Nokia X2 vs. Nokia Lumia 530 - Specifications, Features And Price Showdown
- Trending: Ice Bucket Challenge Replaced By Rubble Bucket Challenge By People Of Gaza
- US, Syria to Work Together to Vaporise ISIS
- European Central Bank Advises Action to Boost Demand and Employment In EU