Industrial growth decelerated in June, as expected

According to the preliminary data, industrial production grew by an unadjusted 4 percent in June year-on-year, while the working day adjusted growth rate was 6.5 percent. This means that, even after some deceleration, industrial growth continues at a medium pace. Also, while the seasonally adjusted output volume dropped by 1.2 percent compared to the previous month, this is just an expected correction after the outstanding leap in May, not a break in the rising trend. Furthermore, the rising trend seems to be underlined by a firm upturn of German industry.

On the whole, industrial production expanded by 5.6 percent in the first half of 2017. While some deceleration is likely in the second half of the year, it will be milder than previously expected. In the light of the still favorable external conditions. we now expect the annual average growth rate to exceed 5 percent.

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