Lithuania: GDP returns to growth in Q1
According to a second estimate released on 1 June, GDP rose 1.2% year-on-year in the first quarter of 2021, contrasting the 1.2% drop tallied in Q4 2020. The reading was revised up from the preliminary estimate of a 1.0% expansion. Meanwhile, in seasonally-adjusted quarter-on-quarter terms, GDP grew 2.0% (Q4: -0.3% s.a. qoq).
The first quarter’s annual improvement came despite stricter measures implemented throughout the quarter in order to curb the spread of new Covid-19 infections. The reading was driven by a rebound in private consumption, which grew 0.6% annually in Q1 after falling 1.3% in Q4 2020. However, government spending swung to contraction, falling at the sharpest rate in three years (Q1: -0.3% yoy; Q4: +1.1% yoy), while fixed investment growth slowed to 6.3% year-on-year in the quarter, following Q4’s 9.0% surge.
On the external front, growth in exports of goods and services lost momentum in Q4, moderating to 3.6% on an annual basis (Q4: +5.4% yoy). Meanwhile, imports rose 4.0% annually, accelerating from the previous quarter’s 0.9% uptick.
The economy is set to expand robustly this year following 2020’s mild contraction. A quick vaccination campaign at home, coupled with reopening economies abroad, will likely buttress growth. However, uncertainty regarding the development of the health crisis dampens the outlook.