Croatia's industrial production fell by 0.7 percent in May 2018 compared with the same month the year before, recording a year-on-year drop for the third month in a row, figures released by the state statistics bureau on Friday showed.

In May 2018, industrial production was 1.8 percent up from April, and it slid by 0.7 percent compared with May 2017. It was the third consecutive month in a row that it dropped, albeit at a slower rate than in April when it declined by 1.3 percent year-on-year.

“With the exception of February this year, the volume of industrial production has continued to fall since November 2017,” analysts at Raiffeisenbank Austria (RBA) said in their comment on the report.

Industrial production has been very unstable since the end of last year, falling in six out of the last seven months. During that period, production volume rose only in February, by 3.3 percent.

“Relatively unfavourable trends in industry, which started in the last quarter of 2017, indicate a fall in demand for domestic products, which is also the result of an economic slowdown in Croatia’s export markets,” RBA said.

In May 2018, compared with May 2017, the production of capital goods dropped the most, by 9.9 percent, while the production of durable consumer goods dropped by 4.1 percent, and that of energy by 3.2 percent. On the other hand, production of non-durable consumer goods increased by 5.8 percent, and the production of intermediate goods rose by 2.3 percent.

Over the first five months of this year as a whole, industrial production inched down by 0.2 percent compared to the same period in 2017.

“This clearly shows that economic growth has slowed down, despite the solid growth of personal spending. In 2018 the industrial production growth rate on average will be slightly lower than last year, reflecting an economic slowdown both in Croatia and the European Union,” RBA analysts said.

In 2017 Croatia’s industrial production increased by 1.9 percent year-on-year.

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