Bosnia Economic Outlook
October 6, 2020The economy took a severe hit in the second quarter as it felt the full brunt of Covid-19 containment measures. GDP fell 9.3% year-on-year, following Q1’s 2.0% expansion, weighed on by plunging domestic and external demand. On the domestic side, investment activity contracted by over a fifth, while household spending shrank markedly; meanwhile, on the external front, exports slumped by almost a third. Moving to Q3, available data points to protracted weakness. The unemployment rate rose and retail sales contracted at a sharper pace in July, indicating constrained household spending. Moreover, industrial production continued to fall at a double-digit rate in July-August, reflecting downbeat private sector activity. Meanwhile, data from the Civil Aviation Directorate shows that passenger traffic was down around 80% year-on-year in August, spelling trouble for external demand.
Bosnia and Herzegovina Economic GrowthThe economy is projected to shrink markedly this year as the Covid-19 pandemic takes its toll on activity. Suppressed foreign demand and plummeting tourism revenues are set to weigh on the external sector. That said, the economy should return to growth in 2021 as global activity recovers. Further waves of the virus pose the main downside risk. FocusEconomics panelists project GDP to contract 5.3% in 2020 and to grow 3.8% in 2021, which is down 0.2 percentage points from last month’s forecast.
Bosnia and Herzegovina Economy Data
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Bosnia and Herzegovina Facts
|Exchange Rate||1.74||-0.65 %||Dec 31|
|Stock Market||0.5||0.0 %||Jan 07|
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