Slovakia GDP Q3 2020

Slovakia

Slovakia: GDP contracts at softer pace in Q3

December 4, 2020

A second estimate confirmed that the economy shrank 2.4% on an annual basis in Q3, matching the preliminary release and softening markedly from the record-breaking 12.1% dive tallied in Q2.

Household spending bounced back in the third quarter, growing 1.0% and swinging from Q2’s 4.2% contraction. Moreover, fixed investment contracted at a milder pace of 10.8% in Q3 compared to the 15.7% decrease in the prior quarter. Similarly, the decline in public spending softened markedly to 0.2% in Q3 (Q2: -10.3% yoy).

On the external front, exports of goods and services returned to growth in Q3 for the first time since Q1 2019, increasing 0.2% year-on-year (Q2: -26.8% yoy). In addition, imports of goods and services fell at a more moderate pace of 6.5% in the quarter (Q2: -27.0% yoy).

On a seasonally-adjusted quarter-on-quarter basis, economic activity rebounded in Q3, with GDP expanding 11.6% and contrasting the 8.3% decrease logged in the prior quarter.

Commenting on Q3’s outturn and the outlook ahead, Tomas Dvorak, assistant economist at Oxford Economics, noted:

“We have raised our 2020 GDP forecast for Slovakia to -5.6%, as the economy in Q3 surprised sharply on the upside […]. Nevertheless, a severe second wave of coronavirus means that output will contract in Q4 and activity should remain subdued in H1 2021 before population immunity is achieved via a general inoculation programme. We expect a strong recovery in H2 2021, with GDP forecast to rise by 4.8% next year.”

Our panel sees GDP growing 5.5% in 2021, which is down 0.5 percentage points from last month’s forecast. For 2022, the panel projects GDP to expand 4.0%.


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Slovakia GDP Q3  20 20 0

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


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