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Industrial production grew in August at slower rate

The growth of industrial production in Slovakia reached 17 percent year-on-year in August, while it stood at 18.4 percent in July, the Slovak Statistics Office announced on Tuesday, October 9.

The growth of industrial production in Slovakia reached 17 percent year-on-year in August, while it stood at 18.4 percent in July, the Slovak Statistics Office announced on Tuesday, October 9.

Following weak performance in the previous months, production in the pharmaceutical industry went up 84.4 percent, the SITA newswire wrote. Production of machinery and equipment not classified elsewhere grew, too, coming up 14 percent. Output of metals and metal structures other than machinery and equipment rose 3.2 percent and in the production of computers, electronic and optical products the growth was 3.8 percent. The volume of output of coke and refined crude oil products declined by 12.4 percent. Other production, repair and installation of machines and equipment went down by 8.5 percent.

"The deceleration of growth was especially caused by the transfer of the company-wide holidays in car-manufacturing companies from July to August," said Slovenská Sporiteľňa analyst Martin Baláž, as quoted by the TASR newswire. Due to the holiday, the year-on-year growth of vehicle production decelerated from 83 percent in July to 77 percent in August. "Cars remain the driving force of the growth. Car production represents 16 percentage points in the year-on-year growth of the industrial production, compared to the 18 percentage points [contributed] in July," he said.

"The dependence of Slovakia's industry on one sector, the automotive sector, remains critical," said VÚB's macro-economist Andrej Arady for TASR, pointing out that the rest of the processing industry only contributed to the growth by less then one percentage point.

Tatra Banka analyst Boris Fojtík said that there is no reason for optimism – despite the positive results. "We only have to look abroad and see industry hitting red figures: -3.1 percent in Czech Republic and -0.8 percent in Hungary," said Fojtík, adding that he does not expect such (high) growth to continue in Slovakia.

(Source: TASR, SITA)
Compiled by Zuzana Vilikovská from press reports
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