Industrial Production in Croatia Falls for the Third Consecutive Month

Industrial production in Croatia fell by 0.7 percent in May compared to the same month last year, marking the third consecutive month of decline, albeit at a slower rate than the previous month.

According to data released on Friday by the Croatian Bureau of Statistics (DZS), industrial production in May increased by 1.8 percent compared to the previous month, while it slipped by 0.7 percent compared to May of last year. This marks a decline for the third consecutive month, but at a slower pace than the previous month, when production fell by 1.3 percent year-on-year.

– Thus, with the exception of February this year, the decline in industrial production volume that has been ongoing since November 2017 continues, analysts from Raiffeisenbank Austria (RBA) noted in their commentary on the DZS report.

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Since the end of last year, industrial production has been very unstable, having fallen in six of the last seven months. During this period, production only increased in February, by 3.3 percent.

– Relatively unfavorable trends in the industry that began in the last quarter of 2017 indicate a decline in demand for domestic products, which is also due to a slowdown in economic activity in Croatian export markets, the RBA analysis states.

In May, the production of capital goods fell the most year-on-year, by 9.9 percent, while the production of durable goods for general consumption decreased by 4.1 percent, and energy by 3.2 percent.

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On the other hand, the production of non-durable goods for general consumption increased by 5.8 percent, and intermediate goods by 2.3 percent compared to the same month last year.

In the first five months of this year, industrial production fell by 0.2 percent compared to the same period last year.

This “clearly indicates that the economy, despite solid growth in personal consumption, has slightly slowed down in growth. The growth rate of industrial production will, on average, be somewhat lower in 2018 than last year, reflecting the slowdown in economic activity both in Croatia and in the EU,” conclude RBA analysts.

Last year, industrial production in Croatia increased by 1.9 percent.