Release Explanation: Measures of the total value of the output from mines, industrial factories and utilities is in the Industrial read. High production numbers usually denote an economy in an upward trend, or growth period. These reports are reactive to change and are well respected.
TheLFB-Forex.Com Trade Desk Thoughts: Industrial production fell in February in the Euro-area by 2.3%, less than what the market had expected. Compared with one year ago, industrial production is down by 18.4%, the largest annual drop on record.
Monthly data shows that energy production fell by 1.0%, and is down by 3.6% from one year ago; intermediate goods decreased 2.4% and are off by 24.2% year-over-year; non-durable consumer goods fell 1.3% from one month earlier, while durable consumer goods tumbled 4.3% in February from January, and are down by 24.7% from February 2008.
“Industrial production has dropped in 13 out of the 16 Euro-area countries. The only countries that recorded a positive contribution were Portugal (+2.4%), Greece (+1.7%) and Poland (+0.4%). Compared with one year ago, industrial production took a strong hit. Annual data shows that the largest decreases were registered in Estonia (-30.2%), Latvia (-24.2%) and Spain (-22.0%),” TheLFB-Forex.Com Trade Team said
Forex Technical Reaction: The euro dropped 20 pips during the news release. Since the new trading day started, the euro has fallen 70 pips and is currently testing the 100-day simple moving average.