I decided to only give a quick overview of the main indicators in this cyclical analysis. A detailed and complete analysis will be published next month. It will be interested to see if, as I expect, the downward trends will continue this month.

The quantity of new orders in the German industry in March confirms that there can be no question of an upturn. The German press indeed unanimously celebrated the figure of 0.6 percent of GDP growth compared to the fourth quarter of last year. However, this is just a special statistical effect, which is probably due to the mild weather and the construction activities related to the accommodation of refugees.  Moreover, the working day adjustments of the Federal Office are possibly questionable because 2016 was a leap-year. A reader sent me interesting statistical information about this. I will use it in part 2, if it can be verified.

All major indicators suggest that the economy is entering a new stagnation. Even new orders in the capital goods sector of the domestic market (not shown here) are very weak and point downwards, which suggests that the German economy lost its internal dynamics.

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The development of industrial production in the euro zone shows what we already suspected: the small peak at the turn of the year was a temporary effect that was probably caused by the uncommonly mild weather. This led to a short upswing in construction. Whatever it was, the trend does not continue in April and in May. Industrial output fell again under the highest value of 2011.

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Nothing much changed in southern Europe. The little hope that Greece had is now gone, Spain shows miniscule growth and Portugal further stagnates.

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Exactly the same applies to the other groups of smaller countries that we distinguish here usually (Austria, the Netherlands, Belgium and the Nordic countries). There is the usual talk of a turnaround, a start of a robust recovery. It is all smoke and mirrors. There are no positive developments to be detected anywhere.

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The eastern European countries, including the Baltic states, are also stagnating. Even the manufacturing output in industry in Slovakia, which was the exception in that it was doing well, flattens now out significantly.

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The Commission’s attempt to impose budget cuts in this economic situation of no growth is characterised by too much ignorance to be believed (see here). The fact that, at the same time, the Commission has waived measures to penalise Germany for its incredibly high account surplus, tells all we need to know about power and ideology in Brussels.