German industry output rebounded in June, surging at its fastest pace in nearly two years, official data showed today.
The figures were a sign that the manufacturing sector is once again powering growth in Europe's largest economy.
Coming on the heels of data showing the strongest rise in industrial orders since October, the Economy Ministry figures showed a 2.4% jump in output on the month, surpassing even the highest forecast in a Reuters poll of 39 economists.
The ministry said this was in part a technical rebound after output fell an upwardly revised 0.8% in May because many workers took time off around public holidays.
But economists said the comeback, which was the strongest rise in output since July 2011, was still impressive.
Germany's economy had propped up growth in the euro zone during the early years of the region's crisis but faltered at the end of last year and only narrowly avoided a recession at the start of 2013.
Today's industry data, however, adds to a string of recent figures showing a pick-up in the economy, that would help boost a broader euro zone recovery.
A survey on Monday showed euro zone business expanding for the first time in 18 months. And data has shown German consumer morale brightening, unemployment falling, business sentiment improving and the private sector expanding.
The economy ministry said "current sentiment indicators suggest a continuation of the positive development in production".
But economists said that risks abounded for the rest of the year, in particular due to a softening of demand from China and the uncertain economic outlook for Germany's main trading partner, France.
German industrial firms have remained cautious during the current earnings season, with many like chemicals maker BASF and Lanxess complaining about weak demand in China and Europe, though some, like Daimler, look to be recovering after a poor start to the year.
