GDP figures and business confidence both fairly weak

Data compiled by the Central Statistical Bureau (CSB) and published August 31 shows that in the 2nd quarter of 2022, compared to the 2nd quarter of 2021, gross domestic product (GDP) rose by 3.0 % (according to seasonally and calendar non-adjusted data at constant prices).

In the 2nd quarter GDP at current prices was EUR 9.5 billion. As compared to the previous quarter, GDP actually went down by 1.0 % (according to seasonally and calendar adjusted data at constant prices).

 

In the 2nd quarter of 2022, compared to the corresponding period of the previous year, total household expenditure rose by 8.0 %. The completely lifted restrictions on the spread of COVID-19 contributed to the increase in household expenses for accommodation and food services as well as recreation and culture. Expenditure in the respective groups increased by 26.8 % and 45.1 %. Expenditure of households on transport (public transport, purchase and exploitation of transport vehicle) has grown by 1.2 %. Due to the geopolitical situation, the prices of energy resources increased rapidly, as a result of which households spent less and reduced their expenses on dwellings (water, electricity, gas and other fuels) by 2.0%.

Separate data published by the CSB showed that for the third successive month business confidence indicators in August 2022 were negative in all business sectors. Compared to July, indicators in construction, services sector and retail trade have improved slightly, but in industry they continue to reduce.

Business confidence indicators characterize general situation in the sector and they are acquired by carrying out business surveys in industry, construction, retail trade and services sector. If the indicator is above zero, business environment is positive, if it is below zero – business environment is negative.

In August 2022 the economic sentiment indicator comprised 94.0, (94.9 – in the previous month). The economic sentiment indicator characterizes the general socio-economic situation in the country during a certain period of time (month), and it is calculated by the European Commission, Directorate-General for Economic and Financial Affairs for all EU countries according to a common methodology, taking 15 various seasonally adjusted components included in industry, construction, retail trade and services sector, as well as in consumer confidence indicator, as a basis. It shows that economic confidence in Latvia is running under that in the EU as a whole.

 

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