German manufacturing production in February experienced the steepest monthly decline in two years, figures by the Federal Statistical Office showed on Friday.

According to the Wiesbaden-based government statisticians, manufacturing output in the Eurozone's largest economy was down by 1.6 percent compared to the previous month.

Broken down by subsectors, the biggest decrease in production was measured for capital goods (minus 3.1 percent), followed by construction (minus 2.0 percent), industrial manufacturing (minus 2 percent) and consumption (minus 1.5 percent) and intermediate goods (minus 0.7 percent).

The Federal Statistical Office highlighted that industrial production, traditionally a key driver of German growth, had lost some of its earlier momentum in February. Nevertheless, relatively high levels of outstanding orders and strong business confidence suggested that the sector would still experience further growth in the course of the year.

The figures were far below most economists' expectation of a growth of around 0.3 percent.

Speaking to Xinhua on Friday, Thiess Petersen, senior economics expert at the Guetersloh-based Bertelsmann Foundation, noted that it was not unusual for production to fall temporarily, in particular during the winter months. However, the current extent of the decline was "surprisingly large."

"It remains to be seen whether this is just a short dip, but it is worrying that other economic indicators have deteriorated as well", Petersen told Xinhua.

Earlier, the closely-watched Ifo business climate index for March fell slightly by 0.7 percentage points to 114.7 points. The index for new orders in the manufacturing fell by 3 percent in period from December to January and the six-month Ifo business climate outlook dropped from 111 points in November 2017 to 104.4 points in March 2018.

The Bertelsmann Foundation economic expert said that growing pessimism among German firms could mainly be attributed to a risk of protectionist policies. "This danger is making companies in the German exporting nation to feel uneasy", Petersen said.

Source: Xinhua