The goods producing sector had another poor month in February. Excluding construction, output fell a further 0.5 percent versus January when it declined a marginally smaller revised 1.8 percent. Annual workday adjusted growth was 2.5 percent, down sharply from 4.4 percent last time.
In line with the results seen across much of the Eurozone, weakness was broad-based with the notable exception of energy. This was boosted by a period of exceptional cold and jumped fully 8.1 percent on the month. However, the same factor will have contributed, probably in no small way, to fresh declines in consumer goods (2.4 percent), capital goods (1.0 percent) and intermediates (1.5 percent).
The poor February results put average industrial production in the first two months of the year 0.5 percent below the fourth quarter mean. March will need to show a monthly 1.6 percent bounce just to prevent a first quarter contraction. Bad weather has been a feature in all of the Eurozone's national industrial production releases in February. The region's full report is due Thursday and will be similarly impacted. To this end, while there was clearly a marked slowdown in Eurozone goods production last quarter, the extent of the underlying deceleration is uncertain. The March report should make things a little clearer.