Latvian industrial production bounces back to growth in September

Latvian industrial production bounces back to growth in September
By bne IntelliNews November 3, 2016

Latvia's calendar-adjusted industrial production expanded 2.4% y/y in September, following a fall of 0.6% the previous month, the Central Statistical Bureau (CSB) reported on November 4.

The growth extends the erratic performance of the Latvian industrial sector over the past 18 months or so, when periods of growth have alternated with declines. Valid questions remain whether Latvian industry is capable of achieving sustained recovery from the depths into which it fell during the crisis in the near term.   

Growth of 5.6% y/y in the manufacturing sector drove the expansion of the headline figure in September, the CSB data show. Output expanded 1.1% in mining and quarrying. However the utilities segment saw production crash 14.5%.

Within the manufacturing sector, production of motor vehicles, trailers and semi-trailers and of furniture did particularly well in September, growing 17.4% and 15.4%, respectively. On the other hand, the segment of repair and installation of machinery and equipment fell 13.7%.

In seasonally adjusted monthly terms, industrial production grew 1.5%, with mining and quarrying advancing 0.9%, while manufacturing expanded 2.2%. The electricity and gas supply segment dwindled 1.2%.  

The uneven performance of industrial output in Latvia will increase worries over the wider Latvian economy, which has recently been projected to expand just 1.9% in 2016, down from 2.7% in 2015. In the second quarter, the Latvian economy grew a seasonally adjusted 0.8% y/y.