Bulgaria: Economic growth ticks up in the final stretch of 2018
March 7, 2019
According to comprehensive data released by the Statistical Institute on 7 March, the economy grew 3.2% in annual and seasonally-adjusted terms in the final quarter of 2018, a notch above both the preliminary estimate and the third quarter’s reading (Q3: +3.1% year-on-year s.a.). Meanwhile, full-year growth came in at 3.1%, decelerating from the 3.8% upturn logged in 2017.
Domestic demand lost traction in the fourth quarter. Total consumption moderated (Q4: +5.0% yoy s.a.; Q3: +6.9% yoy s.a.), largely due to a marked deceleration in household spending amid cooling wage growth and deteriorating sentiment among consumers. Similarly, fixed investment shifted into a lower gear, rising 6.6% year-on-year (Q3: +7.0% yoy s.a.).
External sector metrics improved, however, and propped up the overall expansion. Exports of goods and services rebounded after contracting for two consecutive quarters (Q4: +1.4% yoy s.a.; Q3: -3.6% yoy s.a.), demonstrating resilience amid a more challenging global trade backdrop. Meanwhile, imports of goods and services grew 1.6% year-on-year (Q3: +4.0% yoy s.a.), with the deceleration partly reflecting softer demand dynamics at home.
On a quarter-on-quarter basis, growth in seasonally-adjusted terms inched up to 0.8% in the fourth quarter from the 0.7% outturn in the previous quarter.
Bulgaria GDP Forecast
FocusEconomics Consensus Forecast panelists expect growth of 3.3% in 2019, which is unchanged from last month’s forecast. For 2020, panelists see growth at 2.9%.
Author: Javier Colato, Economist