Slovakia: GDP growth accelerates in Q1
Annual growth more than doubled at the outset of this year, coming in at 3.1% in Q1, compared to a 1.4% year-on-year increase in Q4 2021. The upturn was chiefly driven by stronger domestic demand thanks to upbeat consumer spending and healthy investment activity growth. This contrasted softening foreign demand. Looking at the production side, the wholesale and retail trade, and accommodation and catering services sectors posted stronger outturns, more than offsetting a contraction in the all-important automotive sector.
On a seasonally-adjusted quarter-on-quarter basis, economic growth remained unchanged at 0.4% in Q1, marking the third consecutive period of stable growth.
Commenting on the GDP outlook, Matej Hornák, economist at Erste Bank, painted a somewhat downbeat picture:
“Given the elevated uncertainty and changeable situation, we expect GDP growth to reach 2.0% in 2022, revised to the downside by 1pp owing to the Russian invasion of Ukraine. Economic performance will be dampened by imposed sanctions, supply-side tensions as well as rising inflation, affecting household consumption, willingness to invest and trade flows. In 2023, we expect growth stimulus from EU funds to arrive, which could contribute significantly to the economic growth, in the light of hampered economic activity.”