Euro area Industrial production report highly concerning

Euro area industrial production dropped by -0.4% in May on monthly basis, which stands as worst decline since October last year. However production is still up by 1.6% from a year ago.

Which sectors remain a drag to production?

• Major decline was registered in energy production, which dropped by -3.2% from April, followed by non-durable consumer goods, which dropped by 1.4%.

Which sectors grew?

• Capital goods production rose the most by 1%, followed by durable consumer goods (0.4%) and immediate goods (0.1%).

Where (Country) industrial production grew most?

• Highest annual increase in production was registered in Malta, which grew by 9.5%, followed by Latvia (6.5%).
• Largest monthly increase in production was registered in Lithuania (1.7%), followed by Portugal (1%).

Where (Country) industrial production declined most?

• Highest annual decline in production was registered in Netherlands, where it dropped by -7.4%, followed by Finland (-5.1%) and Ireland (-5%).
• Largest monthly decline in production was registered Ireland (-6.9%), followed by Netherlands (-5.7%) and Greece (-5.1%).

The detailed report is concerning as slow down affected fastest growing Euro zone economy (Ireland) and it also reflects continued slowdown in core economies such as Netherlands.

Euro is currently trading at 1.102 against dollar and likely to decline further against solar and pound.