Latvia: Economy expands at fastest pace in three years
February 9, 2011
According to the flash estimate released on 9 February by the National Statistics Office (Latvijas Statistika), GDP grew 3.7% in the fourth quarter over the same period the year before. The increase represented the second consecutive quarter of improving economic activity and the fastest pace since the last quarter of 2007. The fourth quarter reading represented an acceleration compared to the previous quarter's 2.9% expansion but fell short of market analysts' expectations of a 4.0% expansion. A quarter-on-quarter comparison saw the economy grow 1.1% in seasonally adjusted terms (Q3: +0.9% qoq), suggesting that economic growth is gaining momentum. Based on the preliminary quarterly figures, the economy contracted 0.4% for the full year 2010, which, nevertheless, represented a sharp improvement compared with the devastating 18.0% contraction observed in 2009. Revised and more complete data will be published on 11 March. Meanwhile in its January macroeconomic report, the Central Bank expects the economy to expand 3.3% this year.
Author: Ricardo Aceves, Senior Economist