According to the Czech Statistical Office, industrial production in February 2011 increased at constant prices by 13% YoY. Seasonally adjusted industrial production was higher by 0.2% MoM.
Mr Miroslav Frayer analyst at Komerční Banka said that "After surprisingly high growth of industrial production in January, February’s figures delivered moderate disappointment. Nevertheless, industry still keeps its high momentum and experienced double digit growth for the seventh consecutive month."
He added that "Behind the dynamics stays the recovery of our key business partners, led by Germany. The main drivers are still the sectors with higher added value."
KB had predicted a 15.5% growth, while the consensus of analysts polled by news agency Reuters was 13.7%.
The Ministry of Industry and Trade also pointed to the German recovery as a key factor.
Mr Jaroslav Vomastek, the Ministry of Industry and Trade’s director of economic analysis, said that "The positive development of Czech industry continues to be attributable to rising industrial production in eurozone countries, especially of our most important trading partner, Germany. New industrial orders in the eurozone increased from the beginning of this year by 21.2% and with Germany they improved by 25%."
The YoY growth in industrial production was most contributed to by manufacture of motor vehicles, trailers and semi trailers (with a growth of 26.2%); followed by metal products and manufacture of machinery and equipment.
The deepest industrial production decline was recorded in manufacture of computer, electronic and optical products; electricity, gas, steam and air conditioning supply and food products.
The value of new orders increased by 12.5% on the year. Non domestic new orders grew by 18.2%, while domestic new orders increased only by 3%. The growth was the driven manufacture of motor vehicles, trailers and semi trailers.
KB’s Mr Frayer said that "The forward looking indicators from the eurozone show some decrease of momentum in the coming months, which should also reflect in slower growth of domestic industrial output. This view is supported by the value of new orders, which increased 12.5% as compared with 19.2% in January 2011."
He was optimistic for the rest of the year. He added that "This year, we expect growth of industrial production to continue, when it should add around 8.5%. Fiscal tightening in many European countries as well as domestic restrictions will stay behind the expected attenuation of economic revival in the Czech Republic from last year's 9.9%."
Mr Frayer added that the improving situation in industry has positively affected the labor market. He said that "The average number of persons employed in industry increased 3.5% YoY in February. The average wage in industry increased 4% YoY to CZK 24,552."
(Sourced from www.ceskapozice.cz)
