German industrial output shrinks for second month

German industrial production unexpectedly declined for a second month in October as workers took extra days off, interrupting a run that put Europe’s largest economy on track toward its best performance in six years.

Output declined 1.4 percent from September, when it fell a revised 0.9 percent, the Economy Ministry in Berlin said on Thursday. The reading, which is typically volatile, compares with forecasts for a 0.9 percent gain in a Bloomberg survey. Production was up 2.7 percent from a year earlier.

The report comes after factory orders unexpectedly rose for a third month in October as exporters benefited from surging demand for investment goods from outside the euro area. With order books brimful and business confidence at record levels, the Bundesbank predicts growth momentum will be maintained in the final quarter and beyond.

The vacation days workers took after two public holidays in October contributed considerably to the decline in output, the ministry said in an emailed statement. “Favorable orders and — above all — more optimistic business expectations signal the continuation of good industrial momentum.”

Manufacturing fell 2 percent, led by declines in the production of investment and consumer goods, according to the report. Energy output surged 5.1 percent.