ZAGREB, September 1, 2020 – In July 2020 industrial production in Croatia fell by 1.6% on the year, decreasing for the ninth consecutive month, albeit at a slower rate than in June, according to the national statistical office DZS.
Month on month, industrial production in July increased by 5.6%, but fell by 1.6% on the year.
“The annual decrease in the volume of industrial production, which has been ongoing since November last year, has slowed down ,” analysts at Raiffeisenbank Austria (RBA) said in reference to the DZS report.
Industrial production contracted in two of five sectors, mostly in the production of non-durable consumer goods (-9.3%) and intermediate goods (-2.6%).
On the other hand, the production of capital goods increased by 14.7%, followed by energy (+2.1%), and durable consumer goods (+1.7%).
In the first seven months of the year, industrial production decreased by 5.7% on the year.
Data indicates a continued fall in third quarter
The decrease in production in July and the recent information about the fall in retail sales indicate that the economy will continue to contract in the third quarter.
That means that the economy will officially dive into a recession, which is defined as a fall of GDP for two consecutive quarters.
Last week DZS reported that GDP had contracted by a record 15.1% in Q2 on the year, which is the first time GDP has fallen since mid-2014.