Industrial Production in Germany declined more than expected in March, the official data showed on Friday, suggesting that the manufacturing sector activity is contracting sharply.

Eurozone’s economic powerhouse’s industrial output plunged by 3.9% MoM, the federal statistics authority Destatis said in figures adjusted for seasonal and calendar effects, vs. a -1.0% expected and 0.2% last.

On an annualized basis, German industrial production tumbled 3.5% in March versus a 3.1% growth registered in February.

FX implications

The shared currency is holding the lower ground near 1.0520 on the downbeat German industrial figures.

At the time of writing, EUR/USD is trading at 1.0521, down 0.19% on the day.

About German Industrial Production

The Industrial Production released by the Statistisches Bundesamt Deutschland measures outputs of the German factories and mines. Changes in industrial production are widely followed as a major indicator of strength in the manufacturing sector. A high reading is seen as positive (or bullish) for the EUR, whereas a low reading is seen as negative (or bearish).