European Industrial Output Rises More Than Estimated Amid Demand for Steel
European industrial production increased more than economists forecast in April, led by demand for intermediate goods such as steel and car engines.
Output in the economy of the 16 nations using the euro rose 0.8 percent from March, the European Union’s statistics office in Luxembourg said today. Economists had projected a gain of 0.5 percent, the median of 33 estimates in a Bloomberg survey showed. From a year earlier, April production jumped 9.5 percent, the biggest gain since the data started in 1991.
Reviving exports are helping to fuel the euro-area economy’s expansion as consumers curb spending. Continental AG, Europe’s second-largest car-parts maker, on June 10 raised its full-year sales forecast. Still, European manufacturing growth slowed in May and European Central Bank President Jean-Claude Trichet said last week that the euro region may expand at an “uneven pace” this year.
“The recovery in the export-sensitive industrial sector has been little affected so far by the region’s fiscal woes,” said Martin van Vliet, an economist at ING Group in Amsterdam. “Euro-zone industry should continue to benefit from the recovery in global demand, helped by the recent weakening of the euro.”
The 16-nation currency has fallen 15 percent against the dollar this year on concern governments’ measures to tackle swollen budget deficits may hamper economic growth in the region. The euro was little changed after the output data, trading at $1.2238 at 10:26 a.m. in London, up 1 percent.
Production of intermediate goods rose 2.2 percent in April from March, when it gained 1.1 percent, today’s report showed. Output of capital goods such as factory machinery increased 1.1 percent in April, while energy production fell 0.9 percent in the month.
Emerging economies are leading a worldwide rebound. The Organization for Economic Cooperation and Development said on May 26 that the global economy may grow 4.6 percent this year with China seen expanding more than 11 percent. In India, the economy may grow 8.3 percent in 2010 and Brazil may expand 6.5 percent, the Paris-based group said.
Hanover, Germany-based Continental said last week that it expects full-year sales to rise more than 10 percent after business through May was stronger than expected. Paris-based PSA Peugeot Citroen, Europe’s second-largest carmaker, said on June 2 that it aims to achieve stable sales in the region this year.
In the 27-member EU, industrial output increased 0.5 percent in the month and 7.8 percent from April 2009, according to today’s report.