German industrial production fell 0.8 per cent in September, according to the Berlin economics ministry, which was a bigger drop than analysts expected. After Friday’s disappointing orders data, the latest news seems to confirm that Germany’s economy has shifted down a gear.
Still, don’t write off yet the recovery in Europe’s largest economy. Export figures for September – released a few hours earlier by the federal statistics office in Wiesbaden - went in the opposite direction. Exports were 3.0 per cent higher than August – and a whopping 22.5 per cent higher than September last year. External demand, it appears, is continuing to power German growth.
Moreover, third quarter gross domestic product data on Friday are expected to show Europe’s economy was growing at a fair clip. Even forecasts at the gloomier end of the range are for a rise of about 0.4 per cent
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