Bulgaria Government Consumption (ann. var. %)

Economy grows at softest pace since Q4 2020 in Q4

According to a flash estimate, GDP growth waned to 2.1% year on year in the fourth quarter, from 3.1% in the third quarter. Q4’s reading marked the slowest expansion since Q4 2020. The moderation came on a drop in fixed investment and slower exports growth, which outweighed a larger expansion in final consumption.

Meanwhile, on a seasonally adjusted quarter-on-quarter basis, economic growth was stable at 0.5%.

A detailed breakdown will be released on 8 March.

Analysts at the EIU commented on the outlook:

“We expect real GDP to grow by 2.2% in 2023, as the EU is now likely to avoid a recession. Risks for the forecast arise from the political instability that prevented the approval of a state budget for 2023 and delayed some reforms needed to unlock more EU funding. Tightening rates by the European Central Bank will be a limiting factor for credit growth.”