Euro area - A modest improvement in IP in September Industrial production (IP) figures for the Euro area in September were modestly positive but still suggest limited growth in the third quarter as a whole. After very bad figures in August (revised up but still showing a large m-o-m, seasonally adjusted contraction of 1.4%) the data for September was at least positive in a literal sense. IP increased 0.6% on a m-o-m and y-o-y basis. However, this recovery was not sufficient to lift the gloom about expected soft third quarter GDP numbers and the outlook for the Euro area in general. Despite better September numbers, m-o-m IP numbers remain volatile and the average y-o-y reading for the third quarter (0.6%) was weaker than in the first and second quarters of the year. While survey readings so far for Q4 suggest a recession will be avoided the recent norm of weak growth seems likely to continue without more concrete policy measures. This is especially true as external demand is weakening. A raft of measures taken by the ECB seem insufficient to change the picture without resort to QE. Within Eastern Europe, negative y-o-y IP numbers were recorded in September in Bulgaria and Lithuania. Otherwise, IP expanded in most cases by 1%-3% y-o-y. Stronger numbers were recorded only in Hungary (5.1%) and the Czech Republic (5.6%).
Posted on: Thu, 13 Nov 2014 11:21:33 +0000
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