Industrial Production MoM

What is Industrial Production MoM?

Industrial Production MoM is the monthly percent change in the euro area production in industry index. The IPI (industrial production index) belongs to short term business statistics and ranks among the Principal European economic indicators. Eurostat, the statistical office of the European Union, compiles it for the euro area, the EU and each Member State.

It tracks the volume trend of value added, which is output value minus input costs. Total industry covers mining, manufacturing and energy supply, while construction has its own separate index. Manufacturing holds about 84% of the broader total, so factory dynamics dominate the headline.

National institutes build the national indices from surveys, administrative sources and estimation. Inputs include deflated turnover, physical output, labour input and materials and energy use, since monthly value added cannot be observed directly.

When is it released and what happens each release?

The reference period is the calendar month, and national data reach Eurostat soon after month end. Eurostat publishes a monthly news release plus a database update weeks after month end on pre-announced dates. Publication is free at 11:00 CET, with key data shared with the central bank the evening before and with accredited agencies one hour before release.

Missing national observations for some months are estimated so area and EU aggregates can be computed. Aggregates are published only with 60% weight coverage, and area composition follows the official membership of the reference month. Each release carries area, EU, national and industry group splits with MoM and YoY tables.

European aggregates are released and revised only once per month on the announced dates. National revisions flow into the next aggregate release, and detected errors are corrected at once with an error report. Major methodology changes are announced in advance in the monthly releases.

What moves Industrial Production MoM?

Headline moves reflect 5 Main Industrial Groupings, where each group tracks a demand stage. Energy often moves differently from the total, so readers should inspect the split rather than the headline alone.

• Intermediate goods: inputs later processed by other makers, showing early cycle input demand.

• Energy: output of mining, electricity, gas and steam, excluding water and waste, and the most weather and geopolitics driven part.

• Capital goods: machinery and motor vehicles that gauge business investment demand.

• Durable consumer goods: appliances and furniture that track household durables demand.

• Non-durable consumer goods: food, clothing and pharmaceuticals for everyday demand, with strong pharmaceuticals and weak apparel.

Strength in one group can coexist with weakness in another. The split therefore matters more than any single total.

How is Industrial Production MoM calculated?

1. National indices: institutes build Laspeyres type indices, fixed basket volume measures, from deflated turnover, physical output, labour input and materials use.

1. Common base: national indices are rebased to a common base value of 100 with missing activity totals computed and value added weights applied.

1. Adjustment: working day effects are removed through calendar adjustment and yearly patterns through seasonal adjustment, with Eurostat filling gaps using TRAMO/SEATS software.

1. European aggregation: euro area and EU indices average national indices by value added weights, reusing national seasonally adjusted series for the adjusted aggregate.

1. Growth rates: MoM divides the adjusted index by the prior month and YoY divides the calendar adjusted index by the same month one year earlier.

Key point: industrial production excludes construction, which has its own index. Read MoM only on calendar and seasonally adjusted data and YoY only on calendar adjusted data.