CEIZ index indicates a slight slowdown in GDP growth in the third quarter

Based on the value of CEIZ index in August, analysts from the Economic Institute, Zagreb (EIZ) estimate that economic activity in the third quarter has slightly slowed compared to the previous quarter, and based on the values of the CEIZ for July and August, they expect that the annual GDP growth rate in the third quarter of this year will be 2.5 percent.

As announced by the EIZ on Monday, the CEIZ index in August this year achieved a value of 2.6 index points.

“This value is 0.33 index points higher than the value recorded in July 2016, which allows us to conclude that economic activity in August accelerated compared to July. However, at the same time, the value of the CEIZ index for August is 0.31 index points lower than the average value of the index in the second quarter of 2016, which means that in the third quarter of 2016, economic activity slightly slowed compared to the second quarter,” the EIZ states.

They emphasize that, since the CEIZ index also includes a tourism activity indicator, the value of this index for the third quarter takes into account the excellent results achieved by Croatian tourism this year.

“Based on the values of the CEIZ index for July and August 2016, we expect that the annual GDP growth rate in the third quarter of 2016 will be 2.5 percent, which means that economic activity in that quarter slightly slowed compared to the second quarter of this year,” conclude the analysts from the EIZ.

In the first quarter, the annual growth of real GDP was 2.7 percent, and in the second quarter, it was 2.8 percent.

The coincident economic indicator – the CEIZ index is a monthly composite indicator of the business cycle developed at the Economic Institute, Zagreb, and its purpose is to provide timely information about the current state of the business cycle, which is why the value of the CEIZ index changes simultaneously with changes in the business cycle.

The CEIZ index is a single-number indicator of the business cycle that contains information that would otherwise need to be collected by analyzing a large number of different economic series. Unlike the time series of quarterly GDP, it provides a monthly assessment of the state of the economy, thereby providing more precise information about changes occurring over shorter periods. The CEIZ index is available one to three months before the publication of quarterly GDP data, allowing economic policymakers and the interested public to timely monitor economic trends, the EIZ notes.