Slovakia: GDP growth ticks up in Q1 on surging fixed investment and resilient consumer spending
The economy continued to grow at a solid pace in the first quarter, according to more complete data released by the Statistical Office of the Slovak Republic (SOSR) on 7 June. GDP growth was confirmed at 3.6% annually, marginally above the fourth quarter’s 3.5% print. It expanded at a slightly faster pace on the back of a stronger contribution from the domestic economy, while the external sector lost steam on weaker demand from EU countries.
Private consumption grew 3.5% over the same period last year in Q1 (Q4: +3.6% year-on-year), supported by tightening labor market conditions and substantial wage growth. Moreover, fixed investment jumped (Q1: +12.5% yoy; Q4: +6.1% yoy), sustained by rising inflows of EU structural funds and increasing business confidence. Lastly, government consumption increased 3.1%, matching Q4’s reading.
Export growth decelerated notably from 5.7% in Q4 to 2.4% in Q1, weighed down by cooling demand from EU countries. Meanwhile, import growth remained broadly unchanged at 3.2% (Q4: +3.3% yoy), which translated into a weaker overall contribution to growth from the external sector.
On a quarter-on-quarter basis, the economy grew a seasonally-adjusted 0.9% in Q1, matching Q4’s pace of expansion.