Estonian industrial production extends growth run

Estonian industrial production extends growth run
By bne IntelliNews October 31, 2016

Estonian industrial production expanded 6.5% y/y in September, working-day adjusted data from Statistics Estonia showed on October 31.

The reading extends a growth trend in output to three months; in the past 12 months the sector managed growth in just four. Activity picking up speed in September offers hope that wider economic expansion could still pick up some of the slack this year.

GDP grew just 1.1% y/y in 2015, the slowest in six years. The economy improved somewhat in the first quarter, growing 1.7% y/y, but faltered again in April-June as it recorded a gain of just 0.6%.

Output in the energy production sector drove the headline figure, as it boomed 26.4% y/y, Statistics Estonia notes. That came on the back of a boost in power production of 33%. In monthly terms, industrial production expanded a seasonally adjusted 5.1% in September. 

Of the other two key segments, output in the mining sector fell 3.6% on the year, while production in manufacturing expanded 5.2%. Output of electrical equipment grew 18.5%, while the manufacture of computer, electronic and optical products dwindled 8.2%. Some 70% of total industrial output was sold on the external market, as has been the case for several months.

Despite stuttering industrial output, the European Commission forecasts Estonian growth at 1.9% in 2016. That is an upward revision from 1.6% predicted in February.