GDP growth wanes in Q1

Economy starts the year on softer footing: GDP growth slowed to 3.1% year on year in the first quarter of 2025 on a seasonally and calendar-adjusted basis, from 3.4% in the fourth quarter of last year. On a seasonally adjusted quarter-on-quarter basis, economic growth waned to 0.6% in Q1, compared to the previous period's 0.9% increase and marking the lowest reading since Q4 2023.

External sector fuels deceleration: Domestic demand supported overall growth, rising at the quickest pace in three years. Household spending increased 7.2% year on year in Q1 from a 6.0% expansion in Q4. Public consumption, meanwhile, grew 7.4% in Q1 (Q4 2024: +7.1% yoy). Lastly, fixed investment growth surged to 7.9% in Q1 from the prior quarter’s 1.4%, marking the best reading since Q3 2023. Meanwhile, the external sector drove Q1’s moderation in annual GDP growth. Exports of goods and services slid at a steeper pace of 3.2% in Q1 (Q4 2024: -1.7% yoy). Conversely, imports of goods and services growth sped up to 4.6% in Q1 (Q4 2024: +2.2% yoy), marking the best performance in over two years.

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