Industrial production (ex-construction) expanded at a 0.5 percent monthly rate in June. This followed a slightly larger revised 0.8 percent increase in May and constituted the first back-to-back advance since November/December last year. Unadjusted annual growth was 1.7 percent, down from 2.2 percent in May.
In fact, the underlying performance was rather stronger than the headline data suggest as energy output fell 0.7 percent on the month. Elsewhere, capital goods were up a solid 1.4 percent, consumer goods 0.5 percent and intermediates 0.1 percent.
However, despite the relative buoyancy of May and June, a 1.2 percent monthly fall in April left second quarter production only flat at its first quarter level. To make matters worse, the sector PMI (51.5) in July declined to its lowest mark since October 2016 with growth of new orders effectively drying up. The outlook for third quarter output would seem less than rosy.