German Industrial Output Rises More Than Expected in October

German Industrial Output Surges More Than Expected in October

By Maria Martinez

Dec 8 (Reuters) - German industrial production rose much more than expected in October but economists see no signs of a broader upturn as structural headwinds will continue to take their toll on businesses.

Industrial production increased by 1.8% compared with the previous month, the federal statistics office said on Monday. Analysts polled by Reuters had predicted a 0.4% rise.

Although this is the second monthly increase in a row, Jupp Zenzen, economic expert at the German chamber of commerce, said that is still no reason to sound the all-clear for the sector which has slumped heavily this year.

Cost levels in Germany are high compared to international standards, and order intake remains weak, Zensen said. "This dampens hopes for a quick recovery,” he added.

Output in October was still 0.9% below its level prior to the big slump in August and around 9% below its peak in February 2023, said Franziska Palmas, senior Europe economist at Capital Economics.

"Even over the medium term, we expect industrial production to trend down as structural headwinds weigh on output in the largest sectors," Palmas said.

The construction sector made a substantial contribution, with production rising by 3.3% on the month. The manufacturing sector, which excludes energy production and construction, also saw a notable increase of 1.5%.

The less volatile three-month on three-month comparison showed that production was 1.5% lower in the period from August to October than in the previous three months.

The statistics office added that production in September increased by 1.1% compared with August instead of the provisional figure of 1.3%, following a routine data revision.

The increase in October has only has only offset the significant decline in the summer, meaning that production continues to move sideways, said Ralph Solveen, senior economist at Commerzbank.

"The situation therefore remains unchanged: after several years of decline, the industry appears to have stabilized, but there is no sign of an upturn as yet," Solveen said.

Compared with October 2024, production was up 0.8% in October 2025 after adjustments for calendar effects.

German industrial orders rose by 1.5% on the previous month on a seasonally and calendar adjusted basis, the federal statistics office said on Friday.

(Additional reporting by Anastasiia KozlovaEditing by Ludwig Burger and Toby Chopra)