German production figures post suprise drop

German industrial output unexpectedly fell by 1

German industrial output unexpectedly fell by 1.2 per cent month-on-month in September but the figures are distorted by holidays and are likely to be revised up, the Economy and Labour Ministry has said.

The ministry said the September data, like August's when output dropped 3.7 per cent, was affected by the fact there were holidays in the most populous states.

The fall in September production, which includes output at factories, power stations and building sites, contrasted with a consensus forecast for a rise of 1.8 per cent.

Today's figures followed news yesterday of abigger than expected 0.9 per cent rise in Germanmanufacturing orders in September, which had reinforced recent signs that Europe's largest economy was pulling out of its longest period of stagnation since World War II.