By Paul Hannon
The eurozone's factories, mines and utilities stepped up production at a much more rapid pace than expected in November, the latest sign that the currency area's economic recovery strengthened as 2016 was drawing to a close.
Figures released by the European Union's statistics agency Thursday showed industrial output in the eurozone was 1.5% higher than in October, and 3.2% up on November 2015. That was a much stronger performance than had been expected, with economists surveyed by The Wall Street Journal last week having estimated output rose 0.5% on the month and 1.8% on the year.
Eurostat also raised its estimate for output in October, and now calculates it rose by 0.1% on the month, having previously recorded a 0.1% decline.
The November pickup was led by France, where output jumped by 2.2% over the month. But there was also a 1.7% increase in Spain, and more modest rises in Italy and Germany.
By industrial sector, the surprisingly strong rise was led by the manufacture of non-durable consumer goods, an indication that household spending was on the rise.
The revival in eurozone manufacturing is in line with recent surveys. IHS Markit's measure of activity in the sector, which is based on a survey of 3,000 companies, was at its highest level in the three months through December since the second quarter of 2011, aided by a pickup in export orders.
The pickup will further ease worries over the impact of the British pound's weakening since a June vote to leave the EU. The weaker pound makes goods manufactured in the eurozone more expensive for British buyers. But currency moves can take many months to translate into canceled or reduced export orders, whilethe renewed and sharp decline in the pound's exchange rate over recent days may take a fresh toll on British purchases.
The eurozone economy slowed in the three months to June, and grew at the same, weak pace in the third quarter. A pickup in the final quarter would mean that the eurozone economy grew at around the same, modest pace in 2016 as in 2015.
Write to Paul Hannon at email@example.com
(END) Dow Jones Newswires
January 12, 2017 05:14 ET (10:14 GMT)
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