Latvia’s industrial production falls for second consecutive month in October

Latvia’s industrial production falls for second consecutive month in October
By bne IntelliNews December 5, 2018

Latvia's calendar-adjusted industrial production fell 1.9% y/y in October, the Central Statistical Bureau (CSB) reported on December 5.

Output fell for the second time in a row and the third time overall this year, slightly increasing worries of a slowdown in the industrial sector that could impede economic growth in the fourth quarter.

So far, economic growth appears immune to shocks. The Baltic state’s GDP grew a seasonally adjusted 5.3% y/y in July-September, accelerating on the seasonally adjusted expansion of 4.6% y/y in the second quarter.

The fall in industrial output in October owes to a drop of 17.7% y/y in electricity and gas supply that follows a decline of 12.6% y/y in September, CSB data showed.

Other segments expanded, however, with key manufacturing segment registering growth of 3.3% y/y, 1.3pp above the annual growth recorded in September. Growth also accelerated to 6.3% y/y in mining and quarrying after expanding 2.7% y/y in the ninth month.

Within the manufacturing sector, seven of 16 segments recorded falls in annual production growth in October. Production fell the most in the segment of beverage manufacturing, at 8% y/y. Growth was fastest in manufacture of electrical equipment, where production expanded 20.2% on the year.

In seasonally adjusted monthly terms, industrial production retreated 1.3% in October after falling 3.3% m/m in September.

Output in the manufacturing segment grew 1% m/m in October after falling 1.5% m/m in September. Mining and quarrying saw production grow 1% m/m in October after an expansion of 1.6% m/m the preceding month. In the utility segment, production fell 11.9% on the month, versus a fall of 4.5% m/m in the ninth month.

In January-October, industrial production expanded 2% y/y in calendar adjusted terms, compared to a growth of 9.3% y/y in the same period in 2017.