German industrial output dropped marginally in June, to give a total second-quarter fall of 2.3%, the government revealed yesterday.
Although the decline was less than some economists had feared, the news prompted a sharp fall in the value of the euro. The German economy – the largest in Europe, accounting for one-third of the Eurozone’s total output – is now predicted to grow around 1% this year, the slowest rate in the European Union. It is feared the slowdown in Germany will adversely impact on the rest of the continent.
The government also announced a seventh successive monthly rise in the unemployment rate in July, from 8.9% to 9.2%.
Germany’s decline in output comes in spite of a continued rise in exports, spurred by the weak value of the euro. In addition to the effects of the global slowdown, the economy has been hit by domestic inflation and cautious consumer spending.
News source: New York Times