Italy’s Industrial Production Slows
French industrial output rebounded unexpectedly in May compared with April, signaling it might have bottomed out, as production in the automotive industry has been boosted by government incentives, data published Friday showed.
Industrial output in May increased 2.6% from a month ago, national statistics office Insee said, while economists polled by Dow Jones Newswires had expected a monthly fall of 0.1%.
The May data confirm that the industrial sector has bottomed out, the French finance ministry said. "The destocking process, which accounted for around half of the decline in industrial output during the first quarter of this year, is nearing an end," the ministry added.(…)
BNP Paribas’s Frederique Cerisier noted that since the start of the second quarter, surveys have shown that industrial leaders’ sentiment has improved due to the stabilization of order books and the "strong destocking of finished products."
Mr. Julien said the industrial output rise in May is mainly concentrated in the transport equipment branch which registered its sharpest rise since November 2005 and "is obviously due to the huge increase observed in car production, which explains one-fourth of the whole manufacturing production figure."He added: "All in all, the car industry in a broad sense explains more than the half of the May figure."(…)
Energy, water and mining production was up 4.4% from April after a fall of 6.9% the previous month, while and coking and refining surged 10.2% from the previous month, after a drop of 3.2% in April, and transport material production increased 7.2% after a fall of 0.4% the previous month, Insee said.
Construction in May dropped further though, and was down 0.3% from April after a fall of 0.1% in April from March.
Insee revised downwards its estimate for April when industrial production fell 1.5% from March from an initial estimate of a fall of 1.4%.
Mr. Julien said French industrial output should only drop by around 1% in the second quarter. "This should lead to a quite limited fall in GDP in the second quarter, of 0.4% quarter on quarter. (…)
In Italy, however, May industrial output slowed from a month earlier as production of investment and durable goods slipped, after rising for the first time in a year, Italian statistics office Istat said Friday. Industrial production was flat from a month earlier compared to an upwardly revised monthly rise of 1.2% in April.
When adjusted seasonally and for the number of working days, industrial production fell 19.8% from the year-earlier period, compared with a downwardly revised annual fall of 24.3% in April. A Dow Jones Newswires survey of economists had forecast a fall of 0.8% on a monthly basis in May and a 23.0% drop from a year earlier.
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