European Industrial Production, January 2024: The latest data from Eurostat on industrial production (IP) shows a seasonally adjusted increase of +0.7% for the EU and +0.8% for the sub-set of the Euro-zone. Despite this recent growth, compared to February 2023, total IP fell by -5.4% in the EU and by -6.4% for the Euro-zone.
However, it should be noted that while it does not change the direction of the trends, these figures are distorted by very large swings for Ireland where the data is affected by the presence of multi-national company headquarters (the data is gathered on the basis of turnover of companies classified to the sector). For example, while total Irish IP showed a month-on-month increase of +3.8% , compared to February 2023, it was down by -36.0%.
The 3-month rolling trends calculated from the monthly indices published by Eurostat (including the impact of Ireland) show that total IP in the EU grew by +0.1% when comparing the latest period (December 2023 and January & February 2024) with the previous block (September, October & November 2023); On the same basis, total IP fell by -0.1% in the Euro-zone.
Within the total, the sub-set of the capital goods industries saw output increase by +1.0% in the EU and by +1.2% in the Euro-zone when compared to January 2024; however, looking back to February 2023, there were reductions of -7.5% and -8.9% respectively – on the longer-term comparison, this was the weakest of the sub-sectors of production.
Staying with the 12-month trends, of the 27 Member States, total IP increased in 10, was unchanged in one (Slovakia) and declined in 16. Apart from Ireland which we have already mentioned, the largest falls in total IP compared to February 2023 were in Belgium (-12.7%) and Bulgaria (-8.4%) while the largest increases were in Spain (+3.5%), Slovenia (+2.8%) and Denmark (+2.7%).
You can get the full details from the Eurostat News Release which can be downloaded from their website at https://ec.europa.eu/eurostat/news/euro-indicators (15 April) or requested from MTA.
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European GDP, 4th Quarter 2023: Eurostat has published the quarterly accounts which shows EU GDP unaltered from the previous estimate of “no change” compared to the 3rd quarter of 2023, but the estimate for the Euro-zone has been downgraded to a fall of -0.1% (previously “no change”). This means that, technically, the Euro-zone is in recession with consecutive declines at this level in both the 3rd and 4th quarters of 2023 – note that this is the same as for the UK economy.
However, because there is a mixture of trends by country, only a handful are individually in a recession; these are Estonia, Ireland (both negative in all 4 quarters of 2023 but the latter is notoriously volatile), Lithuania, Finland (both only negative in the latest two quarters) and Sweden (where Q2. Q3 and Q4 had a minus sign). The most significant negative in the 4th quarter was Germany with a decline in GDP of -0.3% but this followed two periods of “no change” in the size of the economy so they are not in a recession (at least for now).
You can get the full details from the Eurostat website at https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Quarterly_national_accounts_-_GDP_and_employment or requested it from MTA.