The decline in industrial activities across the Eurozone is being witnessed.
Eurozone manufacturing output dipped in July. A 0.3% decrease was observed compared to June, as per Eurostat data. Analysts polled by Reuters predicted a steeper fall of 0.5%. There was no growth in production in June, with a minor decrease of 0.1% initially reported. On a year-on-year basis, industrial output dropped by 2.2%.
The production of capital goods, like machines and vehicles, declined by 1.6% compared to June. Producers of durable consumer goods cut their output by a larger 2.8%. Intermediate goods saw a slight dip of 1.3% from the preceding month. Energy producers, however, saw a 0.3% increase in their production.
Economists at the European Central Bank now predict the Eurozone's GDP to expand by just 0.8% in 2022. Previously, they had forecasted a 0.9% growth rate. The revised forecast attributes this to a weaker push from internal demand. "Financial situations remain rigid and the economy continues to be muted, as evident in subdued private consumption and sluggish investment activity," they mentioned.**
The decline in production observed in July might negatively impact the Eurozone's overall economic growth. The decreased production of various goods, including capital goods and durable consumer goods, could hinder the Eurozone's production sector.
