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Bulgaria GDP Q1 2024

Bulgaria: GDP growth speeds up in the first quarter

According to a preliminary estimate, GDP growth improved slightly to 1.7% in seasonally adjusted year-on-year terms in the first quarter of 2024 from 1.6% in the fourth quarter of 2023. On a seasonally adjusted quarter-on-quarter basis, economic growth edged down to 0.4% in Q1, following the previous quarter’s 0.5% growth.

Domestic demand was the key driver behind the acceleration in annual terms: Final consumption growth rose to 4.1% year on year in Q1, picking up notably from the prior quarter’s 2.6%. In addition, fixed investment expanded 7.7% yoy in the quarter (Q4 2023: +4.6% yoy). Meanwhile, headwinds to the external sector’s performance eased: Exports of goods and services fell 1.0% in Q1 (Q4 2023: -2.0% yoy), while imports contracted 3.8% yoy (Q4 2023: -4.5% yoy).

EIU analysts commented on the outlook:

“The impact of the war in Ukraine on Bulgaria and the region will continue to abate. Inflation will slow substantially, which will boost disposable incomes and provide some respite for household spending. In 2024 investor sentiment will improve relative to 2023 […] driven by an expectation of Bulgaria’s full entry into the Schengen area and increased absorption of EU funds. However the country’s exposure to insecurity in the Black Sea will act as a constraint on potential.”

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