Slovakia: Economic growth tumbles to over five-year low in Q2, under siege from external headwinds
August 14, 2019
The economy grew 1.9% year-on-year in the second quarter, marking a notable slowdown from the 3.7% expansion in Q1 and the lowest reading since September 2013. On a seasonally-adjusted quarter-on-quarter basis, GDP growth slid to 0.4% in Q2 from Q1’s 0.7% upturn—the worst result in over six years.
While a breakdown by components is not yet available, industrial output growth weakened notably throughout the second quarter, and contracted in June for the first time since March 2008. This was mainly reflective of weakness in the automotive sector, upon which the economy is heavily reliant on. Moreover, exports fell for the first time in four-and-a-half years in the quarter, as the German economy—Slovakia’s biggest export market—contracted in the period. Meanwhile, shrinking retail sales in Q2 suggests private consumption faltered again in the quarter amid downbeat confidence among households.
More detailed data will be released on 6 September.
Author: Nihad Ahmed, Economist