Serbia GDP

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Serbia: Economy expands for first time in six quarters in Q2

August 31, 2015

In Q2, the economy expanded 1.0% over the same quarter last year, according to data released by the Statistical Office of the Republic of Serbia (SORS) on 31 August. The print was above the 0.9% increase initially reported and contrasted Q1’s 2.0% drop. Moreover, it represented the first expansion after five consecutive quarters of declining output and mostly reflected a sharp improvement in the external sector and investment.

Private consumption in Q2 fell 1.4% in annual terms, which was down from the 0.5% drop observed in Q1, while government spending contracted 2.9% in the same period (Q1: -3.7% year-on-year). Conversely, growth in gross fixed capital formation in Q2 accelerated to an almost three-year high, rising to 8.6% (Q1: +4.3% yoy).

On the external side of the economy, exports of goods and services accelerated slightly from an 8.6% increase in Q1 to an 8.7% rise in Q2. Imports, in contrast, decelerated, falling from an 11.3% increase in Q1 to a 3.0% expansion in Q2. As a result of the increase in exports and the moderation in imports, the net contribution from the external sector swung from minus 2.6 percentage points in Q1 to plus 2.1 percentage points in Q2.

Compared to the previous period, GDP rose a seasonally-adjusted 2.2%, which contrasted the 0.8% drop recorded in the previous quarter.

The National Bank of Serbia expects zero economic growth this year. For 2016, the Bank sees economic growth picking up to 1.5%. FocusEconomics Consensus Forecast panelists expect the economy to contract 0.2% in 2015, which is unchanged over the previous month’s projection. For 2016, the panel sees GDP increasing 1.9%.


Author: Ricard Torné, Head of Economic Research

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Serbia GDP Q215 0

Note: Year-on-year changes of GDP in %.
Source: Statistical Office of the Republic of Serbia (SORS) and FocusEconomics Consensus Forecast.


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