CEIZ index for December 2023: 2.6 percent GDP growth in 2023

February 20, 2024

In December 2023, the CEIZ index increased in value by 1.34 index points compared to the same month in 2022. At the same time, compared to November 2023, the index value decreased by 0.16 points. When observing individual index components, three index components recorded a higher value in December 2023 compared to December 2022: number of tourist arrivals, state budget income from VAT revenues, and real retail trade, while volume of industrial production recorded a lower value. At the same time, compared to November 2023, the seasonally adjusted value of index components decreased in December for the volume of industrial production and state budget income from VAT revenues, while the remaining two index components recorded higher monthly seasonally adjusted values.

The described index movements suggest that GDP in the fourth quarter of 2023, compared to the same quarter in 2022, rose by 3.2 percent, which is the highest annual GDP growth rate recorded in any quarter of 2023. Overall annual GDP growth rate in 2023 would, according to these estimates, amount to 2.6 percent. When observing seasonally adjusted data, according to the estimates based on CEIZ index movements, GDP in the fourth quarter of 2023 stagnated compared to the previous quarter. 

* Monthly assessment of GDP growth rate based on CEIZ index value is indicative and should be used primarily as information on the current condition and trend of the business cycle in Croatia.

What is CEIZ?

Coincident Economic Index of the Institute of Economics, Zagreb (CEIZ) is a monthly composite business cycle indicator developed by the Institute of Economics, Zagreb. Its purpose is to provide timely information on the current business cycle condition. Consequently, the CEIZ index value changes simultaneously with the business cycle, thus indicating the present state of the economy. The CEIZ index was constructed by applying in parallel a dynamic factor model and a Markov switching model. Details on the CEIZ index methodology are described in the paper: Rašić Bakarić, Ivana, Marina Tkalec and Maruška Vizek, 2016, “Constructing a Composite Coincident Indicator for a Post-Transition Country”, Ekonomska istraživanja (Economic Research), 29 (1), pp. 434-445. 

The CEIZ index is useful in three ways. First, it is a single-number business cycle indicator containing information that would otherwise have to be accrued by analyzing a large number of economic series. Second, unlike the GDP series, it provides monthly estimates on the state of the economy, thus providing information on fine changes that took place in a short period of time. Third, the CEIZ index is available one to three months prior to quarterly GDP estimates, meaning that policy-makers and the general public can observe the current state of the economy in a timely manner. 

The index is to be interpreted in such a way that the positive values represent economic growth while the negative ones represent a decreased economic activity.

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