German industrial output slumps, recession fears rise

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, analysts had pointed to a 1.3% fall.

“After a buoyant performance by industrial production 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 fell by 6.5% on the previous month. Production in machinery and equipment fell by 3.4% and output in the construction sector decreased by 4.6% on the month.

In the first quarter, production was 2.5% higher than in the last quarter of 2022, according to the statistics office.

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