# German industrial output slumps, recession fears rise Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-05-08 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: German Industrial Output Slumps, Recession Fears Rise Meta Description: German industrial production fell more than expected in March, sparking recession fears in Europe's largest economy due to weak automotive performance. URL: https://financedigest.com/german-industrial-output-slumps-recession-fears-risehtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-05-08t081922z2lynxmpej4705crtroptp4health-coronavirus-volkswagen-factory-1736814055863-compressed.jpg) # German industrial output slumps, recession fears rise By Maria Martinez BERLIN (Reuters) -German industrial production fell more than expected in March, partly due to a weak performance by the automotive sector, spurring again recession fears in Europe’s largest economy. Production decreased by 3.4% on the previous month following a slightly revised increase of 2.1% in February, the federal statistical office said on Monday. In a [Reuters poll](https://www.financedigest.com/economic-headwinds-set-to-push-oil-below-100-in-2023-reuters-poll.html "Economic headwinds set to push oil below 0 in 2023: Reuters Poll"), analysts had pointed to a 1.3% fall. After a buoyant performance by [industrial production](https://www.financedigest.com/carlsbergs-poland-unit-could-stop-production-lack-of-co2-threatens-food-industry.html "Carlsberg’s Poland unit could stop production; lack of CO2 threatens food industry") at the beginning of the year, there was an unexpectedly sharp decline in March,” the economics ministry said. The [manufacture of motor vehicles and automotive parts](https://www.financedigest.com/the-automotive-vertical-to-witness-a-technological-awakening-by-auto-parts-manufacturing-market-reaching-us-532-bn-by-the-end-of-2029.html "The automotive vertical to witness a technological awakening by Auto Parts Manufacturing Market reaching US$ 532 Bn by the end of 2029") fell by 6.5% on the previous month. Production in [machinery and equipment fell by 3.4% and output in the construction sector](https://www.financedigest.com/construction-machinery-sector-is-primary-growth-factor-for-industrial-hydraulic-filters-market-unveils-fact-mr-2.html "Construction Machinery Sector Is Primary Growth Factor For Industrial Hydraulic Filters Market, Unveils Fact.MR") decreased by 4.6% on the month. In the first quarter, production was 2.5% [higher than in the last quarter](https://www.financedigest.com/delivery-hero-sees-higher-gross-merchandise-value-in-third-quarter.html "Delivery Hero sees higher gross merchandise value in third quarter") of 2022, according to the statistics office. In March, [German industrial orders](https://www.financedigest.com/german-industrial-orders-slump-more-than-expected-in-august.html "German industrial orders slump more than expected in August") fell by 10.7% from the previous month on a seasonally and calendar adjusted basis, posting the largest month-on-month decline since 2020 at the height of the COVID-19 pandemic. German manufacturing is suffering more and more from the global [rate hikes](https://www.financedigest.com/fed-delivers-small-rate-hike-opens-door-to-pause-in-tightening-cycle.html "Fed delivers small rate hike, opens door to pause in tightening cycle"), which are increasingly applying the brakes on the economy,” said Commerzbank’s chief economist Ralph Solveen. The [risks of a recession in Germany are rising.”](https://www.financedigest.com/imfs-georgieva-sees-darkening-outlook-for-global-economy-rising-recession-risks.html "IMF’s Georgieva sees ‘darkening’ outlook for global economy, rising recession risks") [Retail sales](https://www.financedigest.com/uk-retail-sales-jump-unexpectedly-but-big-picture-bleak-2.html "UK retail sales jump unexpectedly, but big picture bleak") and exports also dropped sharply in March, increasing the odds of a downward revision to first-quarter gross domestic product, ING’s global head of macro Carsten Brzeski said. GDP was unchanged quarter on quarter in [adjusted](https://www.financedigest.com/uber-could-post-first-adjusted-profit-this-quarter-as-ride-demand-returns.html "Uber could post first adjusted profit this quarter as ride demand returns") terms in the first quarter, following a 0.5% contraction in the fourth quarter of 2022. A recession is defined as two consecutive [quarters of contraction](https://www.financedigest.com/dollar-pares-gains-as-us-growth-contracts-for-second-quarter.html "Dollar pares gains as US growth contracts for second quarter"). A downward revision would mean the [economy fell into recession](https://www.financedigest.com/uk-economy-on-brink-of-recession-as-it-shrinks-in-august.html "UK economy on brink of recession as it shrinks in August") after all,” Brzeski said. (Reporting by Rachel More and Maria Martinez; editing by Bartosz Dabrowski and Toby Chopra) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---