- Howard Archer, chief economist at IHS Economics
The Euro zone industrial production dropped sharply in November, while there was also evidence that weaker demand for exports from China and other developing countries are restraining the currency bloc's fragile economic recovery. According to Eurostat, the output of factories, mines and utilities declined 0.7% in November from a month earlier, marking the largest month-on-month drop since August 2014. When measured on an annual basis, industrial production rose 1.1% from the same month last year. The decrease in the output was triggered by the energy sector, which plunged 4.3%. Furthermore, there were also falls in the manufacture of capital goods and durable consumer goods that indicate a weakening of demand for some of the Euro zone's exports.
The European Central Bank expressed fears that slowdown in China and other emerging economies including Brazil, Russia and South Africa will hurt the Euro zone's modest recovery by reducing demand for exports. The currency bloc's economy slowed in the three months through September, growing a modest 0.3%. Economists, however, estimate that the economy have expanded at a 0.4% to 0.5% rate in the final quarter of the year.
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