08:11 AM EDT, 10/15/2025 (MT Newswires) -- Industrial production (IP) fell in the eurozone by 1.2% month-on-month in August, following a 0.3% rebound in July, said ING after Wednesday's data.

Despite a boost in industry optimism about production in August, according to the PMI, the reality turned out to be much less positive, wrote the bank in a note. A big decline in capital and durable consumer goods production caused overall production to tick down to the lowest level since January.

Despite optimism among manufacturers returning, the hard data is telling a different story at the moment, stated ING. After a peak in production related to the United States frontloading of European goods, the past few months have shown a declining trend again.

Production is still elevated compared with late-2024 levels, but is quickly moving back in that direction.

Sizeable eurozone investment plans will take time to materialize, which means that while optimism about the medium-term outlook for the eurozone industry has become brighter, there is no immediate reason for short-term optimism, as trade with the U.S. settles into a new regime, added the bank.

For Q3, this means that manufacturing is unlikely to have contributed positively to gross domestic product growth, keeping expectations for growth very muted, according to ING.