Slovakia: Growth softens in Q4 amid a gloomier European backdrop
Detailed national accounts data released on 7 March showed that the economy grew 3.6% year-on-year in the fourth quarter, moderating from the third quarter’s 4.6% expansion and in line with analysts’ expectations. Despite well-anchored domestic dynamics, slower external demand from key European partners weighed on the headline reading.
Domestic demand rose 5.8% in the fourth quarter, markedly accelerating from the 3.7% year-on-year expansion recorded in the third quarter. Growth in private consumption increased from 3.2% in Q3 to 3.4% in Q4, underpinned by lower inflation and all-time low unemployment. In addition, fixed investment rebounded strongly from a quarter earlier (Q4: +9.0% yoy; Q3: -5.7% yoy), while government spending jumped (Q4: +3.8%, Q3: +1.6%).
Looking at the external sector, year-on-year export growth softened in Q4, coming in at 4.7% (Q3: +5.6% yoy), following a broad-base deceleration across the Eurozone’s largest economies. In contrast, imports accelerated in the quarter, expanding 7.8% after a 5.4% rise in Q3.
On a quarter-on-quarter, seasonally-adjusted basis, GDP growth in the fourth quarter came in at 0.8%, down from the 1.1% expansion in the third quarter.