German industrial output expected to remain weak in April

In April, industrial production is expected to have increased by 0.2% mom, following a weaker than expected decline of 0.5% mom in March. Manufacturing output remains subdued due to weak global demand and no major improvement is seen in the near term. 

Construction recovered strongly however and should be in a position to expand further. Even with some strengthening in the rest of Q2, the contribution from the industrial sector to GDP growth in Q2 is likely to be muted. 

The hopes for German growth thus remain in the hands of consumers who should have continued to expand consumption on the back of the strong labour market, rising wages and low inflation.