Czech Republic: Industrial production slows more than expected
August 8, 2011
In June, industrial production expanded 7.4% over the same last year, which represented a notable deceleration compared to the 15.2% increase registered in May and fell short of market expectations, which had seen industrial output increasing 8.0%. The deceleration in June was broad-based, as all the main categories of the industrial production index slowed notably over the previous month. Mining and quarrying grew 6.1% year-on-year (May: +23.0% yoy) and electricity, gas, steam and air conditioning supply expanded 1.9% (May: +5.4% yoy). Manufacturing, which accounts for the bulk of industrial production, increased 7.9% (May: +15.8% yoy). A month-on-month comparison points to an even sharper deterioration in industrial production than the deceleration suggested by the annual figures, as industrial output contracted a seasonally adjusted 1.92% over the previous month, contrasting the 2.62% increase observed in May. As a result of the weak expansion recorded in June, the trend confirms that growth in the industrial sector has passed its peak in February and will continue moderating in the coming months, with annual average growth in industrial production inching down from 11.1% in May to 11.0% in June.
Author: Ricardo Aceves, Senior Economist