German industrial output rises more than expected in January

BERLIN (Reuters) -German industrial production rose significantly more than expected in January, increasing by 3.5% on the previous month, the federal statistical office said on Wednesday.

In a Reuters poll, analysts had pointed to an increase of 1.4% for the month.

The positive development "was driven in particular by strong growth in the manufacturing of electronic equipment ... and chemicals," the statistics office said.

In contrast, motor vehicle and motor vehicle parts manufacturing, as well as pharmaceutical products manufacturing, had shown a strong negative trend.

January's rise should be seen in the context of the marked decline in production in December, down 2.4% following an upward revision, the economy ministry said commenting on the data. In the more meaningful two-month comparison, there was a decline of 0.6%.

Still, the ministry described the trend as "cautiously optimistic" citing surveys showing improved business outlook and declining supply chain bottlenecks.

"Combined with the still well-filled order books, the economic downturn at the beginning of the year should be mild," it added.

Also on Wednesday, the statistical office said that German retail sales had fallen unexpectedly in January by 0.3% in real terms compared to the previous month.

Analysts polled by Reuters had forecast a 2.0% rise in

price-adjusted terms.

The office offers more detailed data on its website.

(Reporting by Friederike HeineEditing by Paul Carrel, Matthias Williams and Tomasz Janowski)