Estonia Economic Outlook
December 23, 2021After returning to pre-pandemic levels in Q2, the economy lost steam in Q3, partly due to a less favorable base effect. Looking at the details of the release, private consumption and exports lost momentum, while fixed investment slumped into contraction. Moving into the fourth quarter, available data points to a slowdown in activity at the start of the period amid rising Covid-19 infection rates, with new daily cases peaking in early November. Industrial production slowed in October, while retail sales waned in the same month. Meanwhile, both consumer and business sentiment deteriorated in October–November, boding ill for consumption and investment in the quarter. In other news, on 9 December the government approved a EUR 70 increase in the minimum wage to EUR 654 per month. This will come into effect in 2022, and bodes well for consumption in the coming year.
Estonia Economic GrowthAfter a likely healthy expansion this year, economic growth should carry over into 2022. Although the base effect will fade, EU funds, combined with lower unemployment and higher wages—aided by the sizable increase in the minimum wage—should boost activity. That said, uncertainty regarding the pandemic and increasing tensions with neighboring Belarus cloud the outlook. FocusEconomics analysts see the economy growing 4.2% in 2022, which is down 0.1 percentage points from last month’s forecast and 3.6% in 2023.
Estonia Economy Data
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|Exchange Rate||1.12||0.65 %||Dec 31|
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Estonia Economic News
January 7, 2022
Consumer prices increased 3.07% in December over the previous month, accelerating from the 1.82% rise logged in November.
January 6, 2022
Industrial output expanded 6.2% year-on-year in seasonally- and calendar-adjusted terms in November (October: +2.5%).
December 5, 2021
Consumer prices increased 1.82% from the previous month in November, contrasting October's 0.15% drop.
December 1, 2021
Industrial output grew 2.8% year-on-year in seasonally- and calendar-adjusted terms in October, which was a deterioration from September's 8.5% increase.
November 30, 2021
GDP growth slowed markedly to 8.6% year-on-year in the third quarter, from 13.0% in the second quarter, albeit largely due to a less favorable base effect. The slowdown was driven by weakening private consumption, fixed investment and exports.