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Eurozone Industrial Production Rebounds In August

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Eurozone industrial production recovered in August as output grew in major factory sectors except non-durable consumer goods, boosting hopes of positive contribution to GDP growth.

Industrial production expanded 1.6 percent in August from July, when it fell by a revised 0.7 percent, data from Eurostat showed Thursday. Output was forecast to grow 1.5 percent.

Among components, energy and capital goods production climbed 3.3 percent and 3.5 percent, respectively.

While durable consumer goods output advanced 4.3 percent, non-durable consumer goods output fell 0.6 percent. Intermediate goods output increased 1.4 percent.

On a yearly basis, industrial production gained 1.8 percent, in contrast to a 0.5 percent fall in July. The annual rate was also faster than the expected 1.5 percent increase.

National data from Germany, France, Spain and Italy earlier showed that industrial production gained strength in August.

However, the industry is unlikely to be able to prevent the euro area economic recovery from slowing in 2017, Jack Allen, an economist at Capital Economics, said.

The outlook for industry remains subdued though and a scenario of muddling through seems the most likely option, Bert Colijn, a senior economist at ING said.

The picture of an economy that fails to pick up the pace persists and this industrial production reading fits that view, he said.

According to the ECB staff projections, the currency bloc will expand 1.7 percent this year and 1.6 percent next year.

Industrial production in the EU28 grew 1.4 percent in August from July, when it fell 0.7 percent. Compared to the previous year, industrial output advanced 1.8 percent.

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