Industrial growth improves significantly in October 2018

Regarding industrial production - Industrial production recorded a slight growth of 1.55% year-on-year in October after falling in September. The improvement was the result of more positive indicators in all three major sectors (manufacturing, mining and energy). However, the most influential improvement was in manufacturing, where growth of 2.64% was recorded in October, compared to only 1.16% in September.

Regarding industrial sales - In October, the growth of sales in the industrial sector (total) accelerated more than 2 times and reached 8.95% on an annual basis. This is due to both accelerated growth in sales on the domestic market and on the international one. In October, both markets reported twice higher growth rates compared to September - 10.68% on the domestic and 7.32% on the international one).

Comment

As we mentioned in the commentary on the September data, an improvement in the growth of the industrial sector is likely in October, and that is exactly what we are observing. Specifically in terms of sales, this is the best month for the sector since January. October marks a serious improvement in the growth of German imports, which certainly had a positive impact on the growth of our industrial sales in the international market. As we mentioned last month, Germany is one of Bulgaria's largest trading partners and a major destination for Bulgarian exports.

Looking at the last two months of 2018, we believe that it is more likely that industrial growth will maintain levels similar to those reported in October, rather than witnessing a serious slowdown similar to that reported in the summer months. The last quarter of any year is usually good for the sector due to seasonal factors, and this year should be no exception.

Data source: NSI

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