Industrial Production (IP) for the EU showed a month-on-month increase of +1.9%, with the Euro-zone up by +2.6%; this follows growth of +1.1% for both areas in February and extends a period of recovery that follows a gentle decline during 2024. Total IP in the EU was +2.7% higher than in March 2024, with an increase of +3.6% for the Euro-zone.
As we have noted before, the data published by Eurostat uses Industrial Production rather than manufacturing (for which it does not provide a breakdown) so it is not directly equivalent to the UK figures at this level, although the figures for capital goods are comparable. Manufacturing makes up the largest part of IP but it also includes output of energy and utilities.
While one month’s figures can be distorted by a number of factors, the seasonally adjusted trends over a period – the longer the better – should give a better indication of a trend and it now appears that, at least up to March, there was a boost to European industrial activity. It remains to be seen if the tariffs imposed (and sometimes suspended) by the US, which came in during April, generate a new turning point.
Tracking quarterly data is more difficult with the format that Eurostat uses but total IP for the EU in Q1-2025 was +1.5% higher than in Q4-2024 (this is mainly generated in February and March). For the Euro-zone, the equivalent trend was +2.2%, with January also seeing a significant month-on-month rise in output that accelerated through the quarter.
At the sub-sector level, in the month-on-month data, capital goods had the strongest growth with output rising by +3.0% in the EU and +3.2% for the Euro-zone. The comparison with a year earlier (March 2024) is more modest with growth of +1.0% for both the EU and the Euro-zone.
Looking at the data by country reveals the source of this growth as the data for Ireland, which is distorted by having many European headquarters operations (often of US companies) – the data is collected on the basis of turnover attributed to companies classified in the industrial sector. There were month-on-month increases in total IP of +11.5% in February and +14.6% in March.
However, this is not the entire story and the latest data reflects some genuine growth in industrial activity. For the comparison with March 2024, of the 27 Member States, total IP increased in 16 and fell in 11. The strongest increases in percentage terms were in Ireland (+50.2%), Malta (+10.1%) and Lithuania (+7.8%) – these are the same three countries for the period to December 2024); there was a change in the opposite direction where Bulgaria (-8.3%), Romania (-7.8%) and Denmark (-5.7%) had the largest declines.
You can get the Eurostat figures from their website at https://ec.europa.eu/eurostat/web/main/news/euro-indicators (15 May) or request it from MTA.