German industrial output beat expectations in October, official data showed Monday, reflecting a continuing rebound in Europe's largest economy before the latest restrictions to control the COVID-19 pandemic were imposed.

Industrial production rose 3.2 percent month-on-month, federal statistics agency Destatis said, driven by a strong performance in Germany's key car industry.

It was the sixth month in a row that production increased, and beat expectations of a 1.5-percent rise from analysts surveyed by FactSet. However, output remains below pre-pandemic levels, with the October figure 3.0 percent below the same month in 2019.

Output in Germany's key auto industry rose by 9.9 percent in October compared with September, although it is six percent down on the pre-pandemic levels seen in February 2020, Destatis said.

Hoping to curb a second coronavirus wave, Chancellor Angela Merkel's government introduced new measures for November targeting hospitality, culture and leisure services, which have since been extended to January 10. But with factories staying open, manufacturing is not expected to be severely impacted.

"The backbone of the German economy is proving its stability in this particular situation," said Jens-Oliver Niklasch, economist at LBBW bank.

"The October figures also help to relieve the main concerns about another sharp economic slump in the final quarter," he added.

Last week, industrial orders data topped pre-pandemic levels for the first time since the start of the health crisis.

Germany's economy expanded by a record 8.5 percent in the third quarter after tough measures were lifted and shops and factories reopened. 

But a decline in economic output may be on the cards for the last three months of 2020, as restrictions hurt the services sector and consumer demand falls.

AFP
Newspaper headline: Germany’s industrial production exceeds expectations in October