Germany's industrial production contraction continues

German industrial production fell by 0.2 percent in August, more than expected. Germany’s industrial production fell for the fourth month in August. Led by the construction and energy sectors, industrial production in Europe’s largest economy fell by 0.2 percent in August compared to the previous month. This brought the industrial production index to its lowest level this year. Economists surveyed by Bloomberg had forecast a 0.1 percent contraction. Weak demand from China, a shortage of workers, high interest rates and the continuing effects of last year’s energy crisis have hurt factories in Germany and therefore the economy as a whole. European Central Bank President Christine Lagarde acknowledged that the weakness in the economy is putting pressure on the entire region. “Germany has built its economic model on very cheap energy sources and export opportunities, especially to China. The ongoing adjustment process in the German economy is affecting the growth outlook,” Lagarde said in an interview with La Tribune Dimanche published on Sunday.