Latvia: Industrial production slows in May
July 4, 2011
In May, industrial production expanded 10.2% over the same month last year, which represented a deceleration compared to the 13.7% increase observed in April, which had marked the fastest pace observed since December 2010. The reading also contrasted market expectations, which had seen industrial output rising 13.9%. The monthly slowdown showed that manufacturing output lost steam, together with a deceleration in electricity and gas supply. In contrast, mining and quarrying rebounded in May, expanding 6.6% after five consecutive months where activity had remained in the red. A month-on-month analysis points to an even sharper deterioration than the moderation suggested by the annual figures, as industrial production contracted a seasonally-adjusted 1.3% in May, which contrasted the 3.4% expansion registered in April. As a result of the subdued May reading, the upward trend in place since November 2009 came to a stop. This halting suggests that the industrial sector will lose momentum in the coming months, with annual average growth in industrial production edging down from 15.3% in April to 15.1% in May.
Author: Ricardo Aceves, Senior Economist