Croatia: Recession deepens in Q4
March 20, 2013
In the last quarter of 2012, GDP contracted 2.3% over the same quarter the year before, according to detailed figures released by the Croatian Bureau of Statistics on 20 March. The result marks a deterioration over the 1.9% contraction tallied in the previous quarter but was in line with the 28 February flash estimate.
Domestic demand drove the deterioration witnessed in the fourth quarter, whereas the external sector improved compared to the previous quarter. Private consumption fell 4.2% over the same quarter the year before, exceeding the 3.5% decline observed in the previous quarter, while government spending also contracted at a faster pace (Q3 2012: -0.4% year-on-year; Q4: -2.0% yoy). Moreover, gross fixed capital formation fell 4.9% year-on-year, which marked a deterioration from the 4.4% drop seen in Q3.
On the external side of the economy, exports of goods and services rose 3.2% in the fourth quarter, up from the 0.1% rise seen in Q3, while imports contracted 1.6% (Q3: -2.8% yoy). As a result, the external sector's net contribution to overall economic growth improved from 1.0 percentage points in the third quarter to 1.6 percentage points in the fourth.
FocusEconomics Consensus Forecast panellists anticipate inflation will end 2013 at 2.9%, which is up 0.3 percentage points from last month's forecast. In 2014, the panel sees inflation at 2.5%.
Author: Armando Ciccarelli, Head of Data Solutions