The Latvian economy grew a seasonally adjusted 3.9% y/y in the first quarter, a flash reading from the Central Statistical Bureau (CSB) showed on May 3.
The result shows a welcome acceleration in economic growth of as much as 1.7pp compared to the adjusted reading from the fourth quarter of 2016. The January-March economic expansion is the fastest since the third quarter of 2015 and the third consecutive quarter of accelerating growth.
Unadjusted growth came in at 3.9% y/y as well, a significant increase on the disappointing 2.6% annual expansion recorded the previous quarter. In quarterly terms, the economy grew 1.5%.
A strong performance across the key sectors of the economy drove the growth. There was an 8% y/y expansion in construction. The sector proved a significant drag during much of 2016 but is currently embarked on a recovery as take-up of EU funding improves. Industrial production grew 10%, while the services sector gained 3%.