Real sector companies stepping up production

Industrial production grew faster last December following higher external demand and import substitution. Real sector enterprises will continue to increase the output in 2017, writes the January issue of ‘Economy: Facts, Estimates and Comments’, an information and analytical commentary.

Surveys have registered an improvement in producer sentiment. All the components of the Industrial Optimism Index (output plans, demand and employment forecasts) reached their five-year highs in January 2017. Changes in inventories support the outlook for further growth in industrial production. Companies have increased their supplies of raw materials and primary products highlighting their intention to step up production.

Real wages will continue to smoothly go up as economic activity recovers. Real pensions are also estimated to grow. That said, an increase in consumer activity will not bring additional inflationary pressure amid higher supply of goods and services. Meanwhile the recovery of aggregate demand will boost production.