German industrial output picks up again in January

German industrial output picked up again in January, the government said Wednesday, as the weather warmed, consumption continued to rise and companies cranked out intermediate goods.

Output gained 1.8 per cent from December, the economy ministry said, in line with an average analyst forecast compiled by Dow Jones Newswires.

The ministry also revised its figure for December sharply higher, though it still showed a monthly decline of 0.6 per cent from the initially given fall of 1.6 per cent.

In January, industrial activity was boosted by a 5.3 per cent increase in intermediate goods used in various manufacturing processes.

Output of consumer goods showed a gain of 5.1 per cent, another sign that German households have a brighter outlook as unemployment falls to the lowest level since current records began in 1999.

Construction activity, which slumped more than 24 per cent in December amidst harsh weather, bounced back with a gain of 36.3 per cent last month. The ministry also publishes a two-month sliding figure to smooth out exceptional effects and it showed a very slight gain of 0.1 per cent in December and January compared with October-November.

After suffering its worst post-war recession in 2009, the German economy, the biggest in Europe, posted record post-reunification growth of 3.6 per cent last year.

The government forecasts growth of 2.3 per cent this year and 1.8 per cent in 2012.

On Tuesday, the central bank said growth could be 2.5 per cent this year.

Figures released by the economy ministry on Tuesday showed that industrial orders jumped 2.9 percent in January following a slump in December of 3.6 per cent.

UniCredit’s chief German economist Andreas Rees noted that was the result of a “comeback of overall domestic demand which hit its highest level since August 2008.”