Euro area industrial production rises in October, to underpin GDP growth in Q4

After reports of a sharp drop in German industrial production in October caused at least to certain degree by calendar effects, and a sizeable rise in the equivalent French data, euro area industrial production was likely to have been little changed that month, noted Daiwa Capital Market Research.

Euro area’s industrial production 0.2 percent sequential in October after a drop of 0.5 percent in the prior month. Manufacturing output grew 0.1 percent sequentially as production of capital goods drops for a second straight month. But these subdued readings followed sharp rises in August; therefore, on a three-month basis the trends continued to be strong.

On a year-on-year basis, euro area industrial output rose 3.7 percent year-on-year, only slightly lower than May’s six-year. So, in spite of the comparatively modest monthly rise in October, the underlying trend in euro area industrial production continues to be robust. And with most euro area manufacturing confidence surveys currently registering multi-year highs, positive momentum is likely to be maintained into the New Year, added Daiwa Capital Market Research.

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