Lithuania Economic Forecast

Lithuania Economic Outlook

September 29, 2020

The economic panorama seems to have improved in Q3, after Covid-19 pushed the economy into its sharpest contraction in over a decade in Q2. Retail sales picked up steam in July, while consumer confidence improved further in August, pointing to recovering demand following the easing of most lockdown restrictions in June. Similarly, industrial output rebounded in August, boding well for the recovery in Q3 amid rising economic sentiment. Externally, conditions were more downbeat: Merchandise exports declined in July–August, albeit at a softer pace than Q2’s average, reflecting still weak but recovering foreign demand. In politics, the country is gearing up for the parliamentary vote on 11 October, with the ruling Farmers and Greens Union and the opposing Conservatives neck and neck in the polls. Nevertheless, economic and political continuity is expected thanks to the need for coalition-building.

Lithuania Economic Growth

The economy is expected to shrink this year as the pandemic hammers both domestic activity and foreign demand, although the downturn will likely be among the softest in the EU. Next year, GDP is seen rebounding steadily, bolstered by solid consumer demand and incoming EU funding, despite uncertainty over the October election results. FocusEconomics analysts see the economy contracting 3.2% in 2020. In 2021, the economy is expected to rebound and grow 4.1%, which is down 0.6 percentage points from last month’s projection.

Lithuania Economy Data

2015 2016 2017 2018 2019
Population (million)2.92.92.82.82.8
GDP per capita (EUR)12,84013,56314,95816,14417,385
GDP (EUR bn)37.338.942.345.348.4
Economic Growth (GDP, annual variation in %)2.02.64.23.63.9
Consumption (annual variation in %)4.14.03.53.73.2
Investment (annual variation in %)4.93.48.28.47.4
Industrial Production (annual variation in %)4.42.96.94.93.4
Retail Sales (annual variation in %)5.36.94.56.55.5
Unemployment Rate8.87.66.76.06.4
Fiscal Balance (% of GDP)-0.30.20.50.60.3
Public Debt (% of GDP)42.639.739.133.836.3
Money (annual variation in %)33.17.35.911.410.4
Inflation Rate (CPI, annual variation in %, eop)-0.11.73.91.92.7
Inflation Rate (HICP, annual variation in %)-0.70.73.72.52.2
Inflation (PPI, annual variation in %)-9.6-4.45.15.6-0.1
Policy Interest Rate (%)0.0-  -  -  -  
Exchange Rate (vs EUR)-  -  -  -  -  
Exchange Rate (vs EUR, aop)1.001.001.001.001.00
Current Account (% of GDP)-2.4-1.20.40.44.4
Current Account Balance (EUR bn)-0.9-0.40.20.12.1
Trade Balance (EUR billion)-2.1-1.9-2.1-2.8-2.2
Exports (EUR billion)19.719.522.824.626.0
Imports (EUR billion)21.821.424.827.328.2
Exports (annual variation in %)-4.3-1.016.97.96.0
Imports (annual variation in %)0.9-2.016.210.13.1
International Reserves (EUR)1.62.53.75.04.5
External Debt (% of GDP)76.986.283.878.468.1

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Lithuania Facts

Value Change Date
Bond Yield0.430.0 %Dec 30

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