German industrial production posted its steepest fall in 23 months in July, in a further sign that Europe's largest economy is set for a slowdown. 

Today's data, published a day after a surprisingly weak rise in industrial orders, added to concerns that the German economy is losing steam. 

Lower demand from emerging markets such as China and concerns about the consequences of Britain's decision to leave the EU are weighing on German exports. 

"Companies in the industry sector continue to adopt a wait and see approach because of sluggishness in the global export markets," the Economy Ministry said in a statement. 

Industrial output in Germany fell by 1.5% on the month, the data showed, confounding the consensus forecast in a Reuters poll for an increase of 0.2%. 

A 1.8% rise in output in the construction sector and a surge of 2.6% in energy output were not enough to offset a 2.3% fall in manufacturing, the data showed. 

Analysts said the figures are more proof that the manufacturing sector is no longer a driver of growth in a world that is increasingly dominated by services.