Central Statistical Bureau comment regarding gross domestic product calculations

09.02.2009

Gross Domestic Product (GDP) changes are characterised by several indicators which are calculated both by quarters and by year together – data at current prices and data at constant prices, as well as unadjusted and seasonally adjusted and working day adjusted data. Analysing indicators characterising GDP changes, it is important to evaluate essence and comparability of every indicator with other indicators.

Taking into account methodology requested and accepted in all European Union, Central Statistical Bureau (CSB) calculates quarterly increase rates at constant prices, using quarterly average value of previous year at current prices. CSB introduced requirements of these regulations publishing results of 3rd quarter of 2008 and informing statistical data users on that beforehand.

GDP at constant prices shows real changes in economy, excluding influence of prices, and because of that use of quarterly average value of previous year at current prices in calculation of change rates is based as approximation to real price level.

At the end of 2008 account system of 2007 was balanced. Audited financial activity results on 2007 of enterprises and institutions showed that there is a significant difference if compared to provisional quarterly information. According to provisional data, including macroeconomic corrections, compared to previous year, in 2007 GDP at current prices increased by 25 per cent, but according to audited results of annual reports, this increase exceeded 32 per cent. Data included in reports witnessed that intermediate consumption rate in production output has decreased, therefore, value added has increased.

Along with changes in GDP on 2007 at current prices, time series of constant prices have changed correspondingly:

GDP at constant prices (growth over corresponding period of previous year)

1st quarter 2007

2nd quarter 2007

3rd quarter 2007

4th quarter 2007

1st quarter 2008

2nd quarter 2008

3rd quarter 2008

Published before balancing of system of accounts of 2007

11.3

11.0

10.9

8.1

3.3

0.1

-4.6

Published after balancing of system of accounts of 2007

9.0

9.3

11.4

10.0

0.5

-1.9

-5.2

Mass media have expressed incomprehension of statistical data characterising GDP, which were calculated with seasonal adjustment method. Seasonally adjusted data are calculated with the help of mathematical methods using whole historical time series. When adjustments are made new quarter is added every time and whole seasonally adjusted time series is changing.

Adjusted and expanded increase rate and value of GDP of the 4th quarter of 2008, as well as new seasonally adjusted time series will be published on March 11, 2009.

Prepared by National Acconts Section
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Elita Kalniņa