Latvia's Ministry of Finance published an assessment of the latest Central Statistical Bureau data showing total industrial output rose 9.2% year on year in the first quarter. The increase was driven mainly by a 40.6% rise in electricity and gas supply, while manufacturing output grew 1%. Within manufacturing, growth was led by fabricated metal products at 19.3% and food production at 6.2%, with food output reaching new records. The largest declines were in wood processing at 2.5%, beverages at 33%, and repair and installation of machinery and equipment at 45.4%. In March, manufacturing rose 4.4% year on year and 1.8% from the previous month, supported by wood processing, metal products, and rubber and plastics. Electricity and gas supply increased 34.6% year on year in March. Electricity generation rose 34.4%, including a 75% increase in hydro output due to snowmelt, while solar plants produced a record 154 million kWh, equal to 20% of total electricity generated in the month. Combined hydro and solar output made March the first month in the past year in which Latvia exported more electricity than it imported. The ministry also pointed to weaker recent sentiment indicators in the European Union and Latvia, mainly linked to the Middle East conflict and oil and diesel price volatility, although Latvia's industrial confidence fell only slightly from the previous month and remained well above a year earlier. It added that, if the conflict does not extend into the summer months, Latvia's manufacturing sector could grow by 2% to 3% this year.

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