Slovak banks maintain 2013 GDP growth forecast at 0.9%, lower estimate for 2014

By bne IntelliNews October 25, 2013

Slovak banks see the country's economic growth in 2013 at an average of 0.9% in their October forecast, keeping their expectations unchanged from a month ago, the National Bank of Slovakia (NBS) said.

NBS polls each month seven selected banks for their calculation on macroeconomic and monetary indicators. Back in November, banks expected the economy to expand by 2% in 2013, but their estimate worsened in line with a deteriorating outlook for foreign demand, as exports are the main driving force of the country's economy. The banks' 2013 GDP growth forecasts ranged from 0.7% to 1.2% this month, unchanged from September.

Slovak bank analysts lowered their average estimate for the economic growth for 2014 at 2.1% in October from 2.2% in September, and the range of forecasts was slightly reduced to 1.5%-2.5% from 1.5%-3% in September. Inflation is now expected to pick up to some 2.1% next year from about 1.2% this year.

In September, the finance ministry revised up its 2013 GDP growth forecast to 0.9% from 0.5% on the back of improved prospects for foreign demand and household consumption. The NBS also expects a GDP growth of 0.9% for this year. The European Commission and the European Bank for Reconstruction and Development (EBRD) have projected a 1% GDP growth for Slovakia in 2013, the World Bank expects a 0.7% growth and the International Monetary Fund has forecast a 0.8% expansion. In the second quarter of 2013, Slovakia's annual economic growth accelerated to 0.9% from 0.6% in the previous three months.

Indicators, banks average forecast Oct-13 Sep-13 Oct-13 Sep-13
  for 2013 for 2013 for 2014 for 2014
GDP, y/y % 0.9% 0.9% 2.1% 2.2%
HICP, y/y % 1.3% 1.6% 2.2% 2.2%
Consumer prices, y/y % 1.2% 1.5% 2.1% 2.1%
Core inflation, y/y % 1.3% 1.6% 2.2% 2.2%
Producer prices, y/y % -0.2% -0.3% 2.2% 2.2%
Current account balance, EUR mn 2 436.7 2 436.7 2 279.8 2 279.8
Trade balance, EUR mn 4 574.9 4 600.1 4 332.4 4 332.4
Source: National Bank of Slovakia        

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