The total value of new orders in the Slovak industry fell by 0.7% y/y to EUR 3.7bn in May 2013, following an 8.1% growth in April, due to a drop in the orders to the auto manufacturing sector, data from the statistics office showed. New orders in the vehicles manufacturing industry, which accounts for almost half of total orders, fell 2.3% y/y in May, after a 6.4% annual growth in April. Slovakia hosts three big auto making plants, run by Germany’s Volkswagen, France’s PSA Peugeot-Citroen and South Korea’s Kia Motors.

The manufacture of computers, electronics and optics, the second most important sector for Slovakia’s export-oriented economy, recorded a 14.5% annual drop in new orders in May, deepening from a 3.8% decline in the previous month.

On a monthly basis, seasonally-adjusted industrial orders fell 4.3% in May, following an 8.5% growth in April.

For the first five months of the year, new industrial orders increased by 2.2% y/y to EUR 17.93bn.

IntelliNews comment: The industrial orders data is another important economic indicator that worsened in May after posting a surprising recovery in April. Exports and industrial sales also slowed down in May, while industrial output remained subdued. As the new orders data provides an insight into the future, we could expect a slowdown in the manufacturing industry in the near term. Slovakia’s export-fuelled economic growth is widely expected to decelerate to below 1% this year from 2% in 2012, reflecting waning foreign demand and subdued domestic consumption.