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Analysts: Slovak Economy Fuelled by Higher Inventories and Exports
Thursday 02 September 2010 Zoom in | Print page
Bratislava, September 2 (TASR) - Foreign demand and the revision of inventories have led the expansion of Slovakia's economy, which grew by 4.7 percent year-on-year and by 1.2 percent on the previous quarter in the second quarter of this year, analysts concur.
"After inventories fell last year by close to €2 billion in Slovakia, we expected them to rise again along with a recovery in industrial production. The first quarter saw inventories fall still further by €220 million, but they then rose by nearly €300 million, pushing GDP up by as many as 5 percentage points," said Slovenska sporitelna analyst Maria Valachyova. Foreign demand soared by 16.5 percent year-on-year in the second quarter.
UniCredit Bank analyst David Derenik notes that in spite of a certain optimism, household consumption remains low and unemployment is stuck at a multi-year high after a slight improvement. "The Labour Code ties down employers and hampers the labour market at this time of short-term corporate planning, while the decline in joblessness is tiny. Legislation increasing labour market flexibility could ... boost the mood for further recruitment and ensure a more stable decline in unemployment," he said.
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