Industrial output continues to grow in processing industry

The data of the Central Statistical Agency indicate that in July industrial output continued to grow in the processing industry. Month-on-month, the output in comparative prices grew 2.7% (seasonally adjusted data), reaching an 18.7% growth within a year (data adjusted to working days).

Foreign demand remained the principal factor of development, but according to the data for June an important growth in new orders was observed also in the domestic market and turnover has grown substantially in several industries. Albeit a gradual recovery of the domestic demand was observed, some indicators point to a slackening in the autumn-winter months. Thus it is foreign demand that, in spite of growing risks of impeded development in global demand, will be the determining factor in the development of processing industries.

Substantial manufacturing growth in July was observed in several industries, and most rapidly output increased in the production of pharmaceuticals, electrical appliances, metal products, and clothing, as well as in some branches of the machinery building sector.

The results of entrepreneur surveys published by the European Commission indicate that in assessing the economic situation entrepreneurs became more cautious in August. The evaluation of the current situation dropped by 3 percentage points and the evaluation of export orders, price dynamics and employment also deteriorated somewhat. At the same time, the view on the overall portfolio of orders that includes also the domestic market is positive: the evaluation improved by 3 percentage points. Moreover, the assessment of the level of the use of production capacities in regard to the third quarter has improved rapidly.

These trends point to the likelihood that an uneven development of the processing industry sector may continue, with annual growth expected in the third quarter, which will amount to a positive contribution of the sector to the overall development of the economy.