Bulgaria: Q2 GDP expansion at lowest level since Q3 2010

In the second quarter, GDP expanded 0.2% over the same period last year, according to revised data released on 4 September. The reading matched the preliminary estimate and was below the 0.4% rise seen in Q1. The expansion marked the lowest print since Q3 2010.

The weaker Q2 expansion reflects a slowdown in domestic demand (Q2: +0.4% year on year; Q1: +0.7% yoy), as private consumption dropped 1.3% (Q1: -1.0% yoy). Government spending rose 2.6% in Q2 (previously reported: +1.8% yoy), which was a deterioration over the 3.2% expansion in Q1. In addition, gross fixed investment expanded 1.4% in the second quarter (previously reported: +1.8% yoy), well below the 5.0% rise recorded in the first quarter.

The external sector exhibited a significant deterioration in Q2. Exports of goods and services rose 4.5% over the same period last year (previously reported: +2.2% yoy; Q1: +10.8% yoy), while imports increased 2.0% (previously reported: +1.1% yoy; Q1: +5.6%% yoy).

On a quarter-on-quarter basis, GDP contracted 0.1% in seasonally and working-day adjusted terms, which contrasted the 0.1% expansion recorded in the first quarter.

The government sees growth rising to 1.9% in 2013 and increasing to 3.1% in 2014. FocusEconomics Consensus Forecast participants expect GDP to expand 1.4% this year, which is unchanged from last month's Consensus. Next year, panelists see the economy growing 2.4%.