Eco Analysis - February German IP expands by 0.5% (H. Amourda)

Eco Analysis - February German IP expands by 0.5% (H. Amourda)

Only a few key economic data were released this Monday. German Industrial production expanded by 0.5% mom in February, while the number for January was revised down markedly. For Q1, growth in industrial production is likely to be around 0, up with Q4, when it fell by 2.6% qoq. Based on a stronger recovery in private consumption, we still expect a robust rebound in GDP in Q1. In the euro area, the April Sentix investor survey fell further from -10.6 in March to -17.3. We now look forward the bulk of European IP data set to be released this week.

Following the stronger than expected factory orders last week, at 2.3% mom, February industrial production surprised on the upside as well. Indeed, the industrial production printed at 0.5% mom (cons: 0.3). Looking at the components, the construction sector contracted by 2.7% mom, possibly affected by poor weather conditions. The Bundesbank report shows some pressures from the energy component which rose from -0.4% mom to 3.9% mom in February, while the manufacturing component increased as well by 0.5% mom from -1.1% mom. Also noteworthy, the January figure was revised down from 0% mom to -0.6% mom. Looking ahead, our scenario remains for a technical rebound in GDP growth in Q1 2013.