-Mario Gruppe, an economist at NordLB
Industrial production of Europe's largest economy expanded most in more than a year in April, boosted by an increase in construction activity after an unusually long winter that damped output. German production jumped 1.8% from March, when it gained 1.2%, posting the third consecutive increase and the strongest monthly gain since March 2012, according to the Economy Ministry in Berlin. On a yearly basis, production expanded 1% when adjusted for working days. Even as business activity in Germany's manufacturing and services sectors improved last month, they still are remaining in contraction territory.
In a separate report, the Federal Statistical Office said the nation's trade balance registered a surplus of €18.1 billion in April on a non-seasonally adjusted basis, down from €18.8 billion recorded in the previous month. Markets, however, expected a surplus of €17.0 billion. Exports from the country rose 1.9% in April, while imports edged higher 2.3%.
Even despite some positive signs from Germany and brighter outlook, the Bundesbank cut its growth forecast, saying the gross domestic product will grow only 0.3% this year, down from a previous estimation of 0.4%. It revised its forecast for 2014, expecting acceleration to 1.5%, from a previous estimate of 1.9%.
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