Slovakia Economic Forecast

Slovakia Economic Outlook

June 2, 2020

The economy shrank at the fastest pace in over a decade in the first quarter. Covid-19-induced containment measures and depressed global demand constrained both consumer spending and activity in the important car industry in Q1, as in March, industrial output contracted at the fastest rate since May 2009. Turning to the second quarter, the scenario has further soured: In April, consumer sentiment plunged to an over one-decade low, while confidence among firms in the industrial sector nosedived to a series low amid falling output and downbeat export expectations. Meanwhile, to reboot the economy, the last stage of reopening was launched on 20 May, allowing restaurants, and accommodation and shopping facilities, among others, to resume activity again. Moreover, although border controls were prolonged to 26 June, the country has opened its borders to Hungary and Czech Republic as of 27 May.

Slovakia Economic Growth

The economy will contract this year. Containment measures to halt the spread of Covid-19 will constrain private consumption, while a weak European trading environment and severed global value chains will cripple exports. Although fiscal and liquidity-boosting measures should mitigate the fallout, a potential re-emergence of the virus is a downside risk. FocusEconomics panelists see the economy contracting 7.1% in 2020, which is down 0.6 percentage points from last month’s forecast. For 2021, the panel sees GDP growth at 6.1% in 2021.

Slovakia Economy Data

2015 2016 2017 2018 2019
Population (million)5.45.45.45.45.5
GDP per capita (EUR)14,71314,93515,55116,48417,282
GDP (EUR bn)79.881.084.589.794.2
Economic Growth (GDP, annual variation in %)4.82.13.04.0-  
Consumption (annual variation in %)2.83.94.43.9-  
Investment (annual variation in %)21.6-9.33.93.7-  
Industrial Production (annual variation in %)6.74.63.34.30.4
Retail Sales (annual variation in %)1.72.16.03.7-1.3
Unemployment Rate11.59.78.16.55.8
Fiscal Balance (% of GDP)-2.7-2.5-1.0-1.1-  
Public Debt (% of GDP)51.952.051.349.4-  
Money (annual variation in %)11.15.26.26.5-  
Inflation Rate (CPI, annual variation in %, eop)-0.50.21.91.93.0
Inflation Rate (HICP, annual variation in %)-0.3-0.51.42.52.8
Inflation (PPI, annual variation in %)-4.3-4.31.95.02.6
Policy Interest Rate (%)-  -  -  -  -  
Exchange Rate (vs USD)-  -  -  -  -  
Exchange Rate (vs USD, aop)-  -  -  -  -  
Current Account (% of GDP)-1.7-2.1-2.1-2.4-  
Current Account Balance (EUR bn)-1.4-1.8-1.7-2.3-  
Trade Balance (EUR billion)-1.01.60.70.0-  
Exports (EUR billion)62.667.271.576.4-  
Imports (EUR billion)63.665.570.876.4-  
Exports (annual variation in %)0.37.36.46.9-  
Imports (annual variation in %)6.33.08.07.9-  

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Slovakia Facts

Value Change Date
Bond Yield0.13-4.12 %Dec 31
Exchange Rate1.120.65 %Dec 31

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