German industrial output rose in July at its fastest pace so far this year. As Grace Pascoe reports it suggests the engine room of Europe's largest economy made a robust start to the second half despite a turbulent global backdrop.
Europe's engine room powers back up - slightly. German industrial output in July rose at its fastest pace this year. With factories producing 0.7 percent more goods than in June. But it remained below expectations. Darren Sinden is from Admiral Markets. (SOUNDBITE) (English) ADMIRAL MARKETS, MARKET COMMENTATOR, DARREN SINDEN, SAYING: "Yes, Germany is still growing, yes it's in a positive position but it is not in that sort of powerhouse position anymore, it is not pulling ahead dramatically, it is not dragging the rest of Europe up with it and unfortunately you have to go look to other areas like Spain for example to see that sort of powerhouse growth." Europe's largest economy will welcome a strong start to the second half. Especially amidst a turbulent global backdrop. (SOUNDBITE) (English) ADMIRAL MARKETS, MARKET COMMENTATOR, DARREN SINDEN, SAYING: "I think German growth is likely to continue. What would be nice to see would be a resumption of more domestic demand to match the export demand that the weak euro has created. So we would like to see more German consumer spending, more growth in domestic focused economies as well as the engineering giants and the automotive manufactures who we always associate with the German economy." Other indicators have been broadly positive in Germany too. Retail sales, private sector growth and business morale all picked up over the summer. But eyes are on China's slowdown which could impact it's exports later this year. It's already hurting investor morale in the euro zone - the Sentix survey for September slipped to its lowest reading since February.