Eurozone industrial output has recorded a big decline as production in France and Germany slipped adding to concerns that the region is heading deeper into recession.
Industrial Production across the region fell 0.4% in January. Economists had been predicting a decline of 0.1%. Factory output fell by 1.4% on year-by-year basis with sharp declines being recorded in Franc, Italy and Germany.
With the region’s largest economy posting a decline worries are growing that contagion from the weaker Eurozone nations has finally wormed its way into the heart of the region. Growth prospects right across Europe are virtually non-existent and the continuingly bad performance of the economy has shown that the so-called ‘experts’ belief that the crisis was over was severely ill judged.
The production of machinery used to create other goods, and is used as an indicator of future business, declined by 1.2% in January from the previous month. The output of durable consumer goods such as cars and furniture saw a decline of 1.4% over the same period.
As a result of the data the Euro has weakened against the majority of its peers. Against the Pound it slid by 0.46% and against the US Dollar it declined by 0.10%.
The latest disappointing reading may provide the European Central Bank with more of an incentive to consider cutting interest rates to below the current 0.75% rate later this year to lower the cost of borrowing for companies and households.
Current Euro exchange rates
As of 11:00 am
The Euro to Pound Sterling exchange rate is currently trading in the region of 0.8694
The Euro to US Dollar exchange rate is currently trading in the region of 1.3015
The Euro to Australian Dollar exchange rate is currently trading in the region of 1.2632
The Euro to New Zealand Dollar exchange rate is currently trading in the region of 1.5788