German manufacturing sector resilient amid renewed lockdown

Berlin, Jan. 8, (dpa/GNA) – Germany’s key manufacturing sector withstood the launch of a renewed coronavirus lockdown in November with trade and industrial production data beating analysts’ forecasts to post solid gains as 2020 came to an end.

While exports from Europe’s biggest economy climbed 2.2 per cent in November, monthly imports surged by 4.7 per cent, the Federal Statistical Office (Destatis) said on Friday.

This resulted in the November trade surplus narrowing to 16.4 billion euros (20.07 billion dollars) from 18.28 billion in October.

Analysts had expected a 0.8-per-cent rise in exports and a 0.4-per-cent increase in imports during November.

Industrial production in November was up 0.9 per cent, Destatis said, a tad higher than the 0.8 per cent forecast by economists.

The data also raises hopes that Germany might escape a fourth-quarter contraction after the pandemic last year plunged the nation into an economic downturn of historical proportions.

“German industry continues to make great progress in recovering from the corona-related slump (earlier last year),” said Commerzbank senior economist Marco Wagner.

“This gives hope that the decline in real gross domestic product will be limited, despite the constraints in the service sector,” he said.

Destatis data to be released next Thursday is forecast to show the German economy shrunk by 5.1 per cent last year.

Germany launched a new round of tough economic measures in November aimed shuttering large parts of public life – such as restaurants, gyms and recreational activities – in a bid to halt spiralling coronavirus cases across the nation.

The lockdown was extended this week by Chancellor Angela Merkel and the nation’s 16 state premiers to the end of this month and includes even more drastic measures aimed at halting the spread of the virus.

But the manufacturing sector has so far been largely excluded from the anti-virus restrictions with the steps principally aimed at the service sector and households.

Production of consumer goods fell by 1.7 per cent in November, Destatis said on Friday.

However, German industrial orders also jumped by a surprise 2.3 per cent in November, according to Destatis data released on Thursday. Analysts had forecast a 1.2-per-cent drop.

Underlining the industrial sector’s resilience, November factory orders came in 6.3-per-cent higher than in the same month a year earlier.

Still, Friday’s data showed manufacturing in the nation as not completely escaping the economic fallout from the global pandemic.

Industrial production slumped by 2.6 per cent in November compared with the same month in 2019.
November exports were down 4.7 per cent and imports fell by 0.6 per cent compared with February, which was the last month before coronavirus took hold around the world and large swaths of the global economy went into their first major lockdown.

GNA