German industrial production grew unexpectedly in February as the coronavirus, or Covid-19, pandemic was yet to have any notable impact on industry, data from Destatis revealed Tuesday.
Industrial production grew 0.3 percent month-on-month in February, confounding expectations for a decline of 0.9 percent. Nonetheless, the pace of growth eased from January's 3.2 percent rise.
On a yearly basis, industrial production declined 1.2 percent after falling 0.9 percent in January.
Excluding energy and construction, industrial production was up 0.4 percent in February. Energy production advanced 2.7 percent, while construction output decreased 1.0 percent.
The economy ministry said industrial production will plummet in March. Construction output will also temporarily experience noticeable losses given the sudden drop in the workforce.
With the recent production stops, lockdown measures and the sharp fall in production expectations in March, the February figures are nothing more than a relic from the past, which looks much further away than it actually is, Carsten Brzeski, an ING economist, said. The ifo institute said industrial production is set to collapse in coming three months. The think tank said the production expectations index fell to -20.8 in March from +2.0 preceding period. This was the most drastic slump since the survey began in 1991.
Data released on Monday showed that factory orders fell 1.4 percent on month in February after rising by 4.8 percent in January.
The industry group BDI predicted that the Germany economy is set to shrink 3-6 percent this year.