German industrial production rebounded in June, official data showed Monday, but analysts warned that the expansion won’t redeem a sluggish second quarter for Europe’s biggest economy.
Industrial output posted growth of 0.8% in June compared with the previous month, preliminary data adjusted for price, calendar and seasonal effects from the federal statistics office Destatis showed. It was a slightly weaker performance than expected ahead of Friday’s quarterly GDP growth announcement, as analysts surveyed by Factset had predicted 0.9% growth.
Growth in June meant a turnaround from May’s unexpected 0.9% shrinkage, which Destatis on Monday revised down from the preliminary figure of 1.3%. The latest release completes a picture of a 1.0% decline in production over the second quarter, the economy ministry said in a statement.
June’s increase “comes too late to make a disappointing quarter for German industry a good one,” economist Carsten Brzeski at ING Diba bank wrote. But the figures “take away some fears of a hard landing of the German economy in the second quarter,” he went on.
Looking to individual sectors, manufacturing saw production growth of 1.5% while construction shrank by 0.5%.
Analysts noted that manufacturing growth in June was unsurprising, as May saw a large number of public holidays cut into output — especially in the automotive sector.
China’s Trade Performance Disappoints in July
China’s economy, the world’s second-largest, struggled in July with a worse-than-expected trade performance as imports plunged 12.5% year-on-year, Customs said Monday.
Imports fell to $132.4 billion, data showed, as weaker global commodity prices and lackluster domestic demand weighed on purchases. The drop in imports was significantly larger than expectations for a 7.0% fall, the median forecast in a survey of economists by Bloomberg News.
Exports also fell in U.S. dollar terms, dropping 4.4% to $184.7 billion — compared with expectations of a 3.5% decline.
As the world’s biggest trader in goods, China is crucial to the global economy and its performance affects partners from Australia to Zambia, which have been battered by its slowing growth -- while it faces headwinds itself in key developed markets. July was the fourth month in a row that exports declined in dollar terms, and analysts described the figures as disappointing.
Taiwan Exports End Losing Streak with Surprise Growth
Taiwan exports ended a 17-month losing streak boosted by demand for electronic parts as U.S. tech giant Apple prepares to launch its new iPhone series, the government said Monday. Exports last month grew 1.2% from July 2015, surprising analysts who had predicted another month of contraction.
Traditionally a technology manufacturing hub, Taiwan has been hit by slowing smartphone demand and stiffer competition from regional firms including those from China. July's exports "benefited from continued increase in demand for semiconductors," the finance ministry said Monday, adding it was the first positive growth since January last year.
Electronic components — the largest among export categories — rose 5.7% from the same period last year, according to the statement. Leading Taiwanese firms such as Foxconn and TSMC are among Apple's suppliers.
The island's exports are getting a lift ahead of the release of Apple's new iPhone 7 series, according to Barclays analyst Angela Hsieh, who had forecast a slide of 1.7% for July. The boost came earlier than analysts had expected, with the launch date now rumored to be in September.
Copyright Agence France-Presse, 2016
