• Production: The Spanish industry returns to negative rates in full wave of tension between the US and China
  • Timeline.USA vs. China: an increasingly worrisome trade war

The deceleration data is increasingly evident, however much the acting Government wants to insist on the robustness of the Spanish economy [the Treasury Minister, María Jesús Montero, did it again yesterday]. In recent weeks we have seen worrying data on employment, exports, home sales, investment ... and yesterday, again, industrial production.

Although the May data allowed the sector to take a break, with a rebound after two months in red, the behavior of June returned to show negative rates, with a decline of 1.8%.

But more than the fact, what worries is the international context that accompanies it. Yes, the horizon is not exactly flattering: with the panic of a new recession in full bloom due to the escalating tension between the United States and China , with central banks constantly alert, and with Germany , the European locomotive, giving new unequivocal symptoms of slowing down.

Its industrial production has suffered this week its biggest fall since the economic crisis and pessimism and the ghost of the recession is already imposed in all areas in the German country. According to Robert Lehmann, a joint expert at the Ifo economic research institute, the picture is so bleak that there are more and more companies that want to reduce their production in the next quarter .

It is a manual measurement. Less orders, less production. "The end of the recession in German industry is not foreseeable right now," says Lehmann. And that will have consequences in the labor market.

The manufacturer of components for the car and tires, Continental, has already announced that in order to dampen the negative trend in its profits, the workforce must shrink. Bosch will do the same to the fall in orders , especially in diesel engines.

For ING Bank analysts, the Economics data is doubly "alarming" because it rains on the wet and there is no glimpse of a trend change on the horizon, very obscured at the moment by the commercial conflict between the two great titans of the world economy , United States and China. "We must prepare for a recession in Germany," warns ING Bank.

Industrial production 2019 2

Until now, the German situation has been sustained thanks to the increase in consumption, a pillar that also begins to falter, given that in times of convulsion and insecurity, citizens cut spending. Given this scenario, experts expect a 0.2% drop in GDP in the second quarter , and perhaps also in the third. "We are moving towards a technical recession," DekaBank economist Andreas Scheuerle ventures. The Bundesbank (German central bank) will publish that data August 14.

All sectors fall in Spain

In Spain, the General Industrial Production Index (IPI) has fallen by 1.8% in June and all industrial sectors, except energy (+ 4.8%), cut their production: intermediate goods (-5.5 %), durable consumer goods (-4.8%), non-durable consumer goods (-3.1%) and capital goods (-0.5%).

The data, released yesterday by the INE, arrives only one day after the meeting that the acting President of the Government, Pedro Sánchez, and the Minister of Industry and Tourism, Reyes Maroto, kept with representatives of the industrial sector, who warned them that uncertainty and the absence of government only "aggravate" the crisis in the sector.

On the table urgent matters such as the status of electro-intensive and the urgency of correcting a factor, which reduces competitiveness with respect to other countries, including European partners, such as the high cost of energy: it is 37% and 30% more expensive than in France and Germany, respectively, according to Aege figures, the Association of Large Energy Consumption Companies, present at the meeting.

In addition, there is great concern about the repercussions that external factors such as commercial tension between the United States and China or Brexit may have on our companies and exports.

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  • U.S
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  • Maria Jesus Montero
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  • Pedro Sanchez
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  • France
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