Industrial production rises 0.9% m-o-m in May

Industrial output grew by 0.9% m-o-m and 8.6% y-o-y in May, according to new data published yesterday by the State Statistics Committee. YTD growth was equal to April’s level of 8.5% (vs. +12.9% YTD in May 2010). The fastest growing sectors were chemicals +21.2% y-o-y, machinery +18.9% y-o-y and mining +8.6% y-o-y, while metallurgy added just +6.4% y-o-y. Svetlana Rekrut:  We attribute chemical production growth to a low base effect and the global recovery in the fertilizers market (ammonia prices rose +40% y-o-y in 1Q11). The machinery sector benefited from automobile market growth, with automobile output increasing 35% y-o-y and freight railcar production rising +26.6% y-o-y, triggered by demand from Ukrainian and Russian markets.