ABN AMRO expects Eurozone and German industrial production to rebound, helped by recovering domestic demand and stronger defence-related activity in Germany. However, it looks for a pullback in German factory orders after late-2025 strength. Overall, the bank judges manufacturing to be on a recovery path, but notes new headwinds from higher energy prices that could temper momentum.

Industrial output seen rebounding cautiously

"Eurozone – Industrial production is likely to have rebounded in Germany and the broader eurozone, reflecting the recent recovery in domestic demand – especially from the defence sector in Germany."

"With that said, factory orders in Germany are likely to register a pullback in January following the surge in orders in the final months of 2025."

"Big picture, the manufacturing sector remains on a recovery path, notwithstanding the new headwinds from higher energy prices."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)