Doubts were raised over the strength of the economic recovery in the eurozone on Monday, after figures showed industrial output fell for the first time in six months in October amid continued weakness in household spending.
Industrial production dropped 0.6 per cent from September and is now down more than 11 per cent year-on-year, according to the European Union’s statistical arm.
The drop is mostly down to flagging demand for consumer goods across the 16-member currency bloc, with significant variations once again appearing between member states.
The bulk of the fall was borne by Germany, where production eased 1.8 per cent, although production in France, Ireland and Portugal also fell. The Netherlands and Italy bucked the trend with modest improvements.
Economists blamed weak household demand for consumer goods for the lacklustre figures, pointing to a 0.5 per cent drop in eurozone employment during the third quarter, according to EU figures also released on Monday.
The number of people employed across the wider EU fell by more than 1m compared with the previous quarter, marking 15 months of contracting employment.
All segments of the economy, bar those related to the public sector, shed jobs, led by continued falls in construction, manufacturing and financial services.
“Overall, today’s figures confirm the previous picture of an economy that is staggering, rather than bounding, back towards health,” said Colin Ellis, economist at Daiwa Securities.
Martin van Vliet at ING called the relapse in industrial production “sobering”, but stressed that the data were volatile and advised “it is premature to conclude that the industrial recovery is seriously losing momentum, let alone that it has run its course”.