FXStreet (Łódź) - Carsten Brzeski from ING comments on the disappointing German Industrial Production numbers released in the European morning, showing a 1.8% month-on-month fall in May, the third consecutive monthly drop.

Key quotes

"German industrial production dropped sharply in May, showing that earlier risk factors like slowing emerging market economies, including China, and geopolitical conflicts do have an impact on the German economy."

"The last time industrial production had dropped for three months in a row was in the summer of 2012."

"The overall level of industrial activity is still strong and the safety net for the German industry, richly filled order books and low inventories, is still boding well for the coming months. However, the stimulus for a further acceleration is currently missing."

"In fact, latest data give the impression that the dichotomy between soft and hard data has returned to Germany. While sentiment indicators, despite recent softening, still point to solid growth, hard data is less encouraging."

"It could take until the third quarter before the dichotomy disappears again. Until then, today’s industrial production data show that the German island of happiness has been brought back to mainland."

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