Lithuania: GDP growth records slowest increase since Q1 2021 in the first quarter
According to a second estimate, GDP growth lost momentum, falling to 4.6% year-on-year (yoy) in the first quarter, from 5.2% in the fourth quarter of last year. Q1’s reading marked the slowest rate of growth since Q1 2021.
Private consumption increased 6.6% in the first quarter, which was below the fourth quarter’s 8.8% expansion. Government consumption growth moderated to 0.8% in Q1 (Q4 2021: +0.9% yoy). These slowdowns more than offset the impact of a rebound in fixed investment: It grew 5.4% in Q1, compared with a 0.8% decrease in the prior quarter.
Exports of goods and services increased 21.1% on an annual basis in the first quarter, which was above the fourth quarter’s 17.2% expansion. In addition, imports of goods and services growth picked up to 21.2% in Q1 (Q4 2021: +19.5% yoy). Consequently, the external sector contributed 1.7 percentage points to the overall reading, contrasting the prior quarter’s 0.2 percentage point detraction.
On a seasonally-adjusted quarter-on-quarter basis, economic growth moderated to 1.0% in Q1, following the previous quarter’s 1.3% expansion.
Going forward, our panelists expect economic growth to more than halve in Q2. Household consumption will be hit by elevated price pressures—particularly commodity prices. Moreover, the war in Ukraine is expected to take a toll on activity and will remain the main upside risk.