- ING
German industrial production unexpectedly declined in August, signalling that Europe's largest economy is feeling the effects of weaker demand from emerging markets. According to Destatis, production in the Euro area's powerhouse dropped by 1.2% in the reported period, following a revised 1.2% growth in July. Analysts expected a reading to gain 0.2% in August. On an annual basis, industrial output rose 2.3% in the given month, compared to a revised 0.8% increase in the prior month, while markets projected a 3.3% growth. The recent report also revealed that Germany is currently grappling with a slowdown in China and other emerging markets, as factory orders from countries outside the 19-nation Euro region fell more than 13% in July and August combined. Therefore, Germany's production focus is shifting to strengthening domestic spending. Meanwhile, industrial sector in Spain expanded at a slower pace in August after a significant gain seen in the previous month. Industrial output in the Euro zone's fourth largest economy showed a 2.7% year-on-year rise during August, compared to the previous month's 5.2% reading. In the meantime, France's external trade deficit narrowed in August, as imports fell at a faster rate than exports. According to the French Customs, the deficit shrank to 2.975 billion euros in August from 5.283 billion euros in the same month last year.
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