| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Month over Month | 1.0% | 0.5% to 1.0% | 0.8% | -1.1% | -0.4% |
| Year over Year | -0.5% | -1.7% to -0.3% | 0.0% | -2.0% | -1.5% |
Highlights
Industrial output rebounded with a 0.8 percent monthly increase after a 0.4 percent decline in December 2024, 0.2 percent points below the consensus, signalling short-term recovery. However, stability in annual production suggests a lack of sustained momentum.
Sectoral trends reveal contrasting dynamics. The 1.6 percent rise in intermediate goods suggests renewed industrial demand, while capital goods grew modestly (0.5 percent), indicating cautious investment. However, the 3.1 percent drop in non-durable consumer goods and 1.2 percent decline in energy production highlight weak consumer demand and potential shifts in energy consumption.
Industrial production stagnated on an annual basis, with notable declines in capital goods (minus 2.7 percent) and intermediate goods (minus 0.8 percent), hinting at reduced long-term investment and supply chain sluggishness. However, the 6.7 percent surge in non-durable consumer goods and 0.9 percent increase in durable consumer goods suggest resilience in consumer-driven industries. Regionally, among the top 4 economies, industrial production fell in Spain (minus 1.0 percent after 2.2 percent), France (minus 1.5 percent after minus 1.0 percent), and Germany (minus 1.8 percent after minus 3.1 percent) on an annual basis.
Today's update points to a short-term rebound but long-term stagnation, with weak energy and capital goods sectors possibly reflecting structural challenges, taking the RPI to 21 and the RPI-P to 22, meaning that economic activities are well ahead of market expectations in the euro area.
Sectoral trends reveal contrasting dynamics. The 1.6 percent rise in intermediate goods suggests renewed industrial demand, while capital goods grew modestly (0.5 percent), indicating cautious investment. However, the 3.1 percent drop in non-durable consumer goods and 1.2 percent decline in energy production highlight weak consumer demand and potential shifts in energy consumption.
Industrial production stagnated on an annual basis, with notable declines in capital goods (minus 2.7 percent) and intermediate goods (minus 0.8 percent), hinting at reduced long-term investment and supply chain sluggishness. However, the 6.7 percent surge in non-durable consumer goods and 0.9 percent increase in durable consumer goods suggest resilience in consumer-driven industries. Regionally, among the top 4 economies, industrial production fell in Spain (minus 1.0 percent after 2.2 percent), France (minus 1.5 percent after minus 1.0 percent), and Germany (minus 1.8 percent after minus 3.1 percent) on an annual basis.
Today's update points to a short-term rebound but long-term stagnation, with weak energy and capital goods sectors possibly reflecting structural challenges, taking the RPI to 21 and the RPI-P to 22, meaning that economic activities are well ahead of market expectations in the euro area.
Market Consensus Before Announcement
Output is seen up 1.0 percent on the month and down 0.5 percent on year in January.
Definition
Industrial production measures the physical output of factories, mines and utilities. The measure provided by Eurostat excludes the volatile construction subsector for which data are released a few days later.
Description
Industrial production measures changes in the volume of output for the EMU's member states. The industrial production index provides a measure of the volume trend in value added at factor cost over a given reference period, excluding VAT and other similar deductible taxes. The preferred number is industrial production excluding construction. As with other EMU statistics, the data are provided by the national statistics offices to Eurostat (the European Union statistical agency) where it is combined to produce an overall output measure.
Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that will not lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios.
Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that will not lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios.
