Slovakia's economic sentiment deteriorates further in January.

By bne IntelliNews January 31, 2013
Slovakia's economic sentiment index worsened for the eighth month in a row in January 2013, reaching its lowest level since December 2009, data from the countrys statistics office showed. The value of the economic sentiments three-month running average (re-calculated for the new basic period, average of year 2010) fell by 0.9 points from December to 87.7 points in January. The economic sentiment indicator was affected mainly by an unfavourable development in the sector services and partially also in the retail trade sector. The confidence indicator in services decreased in January by 6.6 points to 4.7 points, its lowest value since December 2009, affected by negative evaluations of all the three components. The confidence indicator in retail trade weakened by 0.4 points to 5.3 points, affected by more pessimistic evaluations of the business situation over the past three months and by a higher stock of goods. The confidence indicator in industry rose by 1 point to -9.3 points thanks to expected increase of the production in the next three months and by a decrease of the stock of finished goods. In the construction sector, the confidence indicator increased by 3 points to -54 points, as a result of more optimistic evaluations of both of its components - current demand and expected employment. The indicator was by 28 points lower than its long-term average in january. The consumer sentiment improved in January with the indicator gaining 1.8 points to -37.1 points. Consumers were more optimistic about the developments in the economy and unemployment, and about the expected financial situation of households, while they were more pessimistic about the expected savings of households. On an annual basis, the economic sentiment indicator in January was by 10.2 points lower. It was by 17.3 points lower than the long-term average. IntelliNews comment: Slovakias economy showed resilience to the crisis in the eurozone last year, as it grew by 2.5% y/y in the first nine months of the year. However, the growth of the countrys export-driven economy was boosted almost solely by sharply increased car production and exports, while domestic demand fell as both investments and consumption of households and the public administrations shrank. The further decline in the economic sentiment indicator supports our forecast for a significant slowdown of economic growth this year amidst weakening foreign demand and the governments austerity drive.
Jan-13 Dec-12 m/m change, points
Economic sentiment indicator (ESI) 87.7 88.6 -0.9
Components of ESI:
Industrial confidence indicator (40%) -9.3 -10.3 1.0
Construction confidence indicator (5%) -54.0 -57.0 3.0
Retail trade confidence indicator (5%) 5.3 5.7 -0.4
Services confidence indicator (30%) 4.7 11.3 -6.6
Consumer confidence indicator (20%) -37.1 -38.9 1.8

Slovakia's economic sentiment deteriorates further in January.

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