Industrial production in the euro area declined more than expected in January as output of energy, durable consumer goods and intermediate goods decreased from the previous month.
The 1.0% decrease was well-below Econoday's consensus forecast of a 0.4% rise and was down from the 0.4% month-over-month increase in December 2017.
Production of energy declined by 6.6%, durable consumer goods production fell by 1.9%, and production of intermediate goods was down 1.0% from the previous month. Production of capital goods and non-durable consumer goods increased.
Industrial production rose by 2.7% in the euro area in January 2018 from January 2017, compared to expectations of a 4.7% increase. Production of capital goods, intermediate goods, durable and non-durable consumer goods rose from a year earlier, while energy production decreased.
The weaker industrial production data was mainly due to a drop in energy production, said Bert Colijn, senior economist at ING Research. All other production categories have increased from a year earlier, indicating production continues to recover at a relatively strong pace, he said.
Industrial output growth could slow in the second half of the year because of a decline in new orders. "A mild slowdown in the manufacturing sector would be in line with our forecast of somewhat moderating GDP growth as the year progresses," Colijn said.
