Germany’s vital industrial sector faced a record 18% plunge in April, the worst since reunification.
Europe’s largest economy is reeling after production grinded to a halt in its industrial heartland and disruption broke records with factories being closed and orders vanishing.
The stark contraction is the worst ever according to Germany’s federal statistics agency since it was founded in 1991 and follows a profound downward impact on the overall economy,
With manufacturers closing factories and Germany’s large car industry unable to produce anywhere near its normal quota – many suppliers across the economy have been badly affected.
And following the pandemic’s disruption to travel, multinational companies trading in Germany’s heavily export-led economy took a huge hit. Demand for capital equipment was down a whopping 35% and German industrial production fell faster than 2008’s lowest ebb to levels not seen since the mid 70s.
While the German economy and its people have endured unimaginable hardships in previous decades, news of the slump in manufacturing will create additional political pressure on German Chancellor Angela Merkel to start a large fiscal stimulus – having already announced a big economic package of incentives.
With European economies from Germany to Italy all facing severe downturns, additional stimulus and measures are likely to be announced in the coming weeks.
Source: The Britonian