BERLIN, Aug 7 Reuters German industrial production dropped more strongly than forecast in June, according to data released on Monday, underlining the challenges faced by manufacturing amid a downturn in Europe39;s largest economy.

Production fell by 1.5 compared with the previous month, the federal statistics office said on Monday. Analysts polled by Reuters had predicted a 0.5 decline.

The office offers more detailed data on its website.

The minus in June provides a taster for the poor production figures that are on the horizon for the coming months, said Commerzbank chief economist Joerg Kraemer.

He pointed to a downward trend in orders and indications that companies had already worked off their order backlogs from the COVID19 pandemic.

The Germany39;s manufacturing sector has already had a difficult year so far due to dwindling orders, sluggish output and high prices, with the HCOB final Purchasing Managers39; Index PMI for manufacturing falling for a sixth consecutive month in July.

Kraemer said the German economy was expected to contract again in the second half of 2023.

Germany39;s winter recession ended in the second quarter, when GDP stagnated, according to preliminary data.

Reporting by Rachel More Editing by Miranda Murray and Friederike Heine

Source Reuters