Croatia Private consumption

Economic growth eases in the second quarter of 2026

GDP reading: Croatia's GDP grew 1.7% on a year-on-year basis in Q2, following a 2.2% expansion in the previous quarter. Q2's reading was the weakest since Q4 2020. In seasonally adjusted quarter-on-quarter terms, the economy increased 0.4% in Q2, following a 0.1% contraction in the prior quarter

Drivers: Compared to the previous quarter's data, figures in Q2 softened for private consumption (+0.5% on a year-on-year basis vs +2.6% in Q1) and fixed investment (+1.7% vs +2.5% in Q1). In contrast, readings picked up for government consumption (+2.0% vs +0.7% in Q1), exports of goods and services (+3.0% vs -1.6% in Q1) and imports of goods and services (+3.4% vs -0.3% in Q1).

Panelist insight: Commenting on the outlook, Alen Kovac, analyst at Erste Bank, said: “In 2H26, domestic demand should continue to remain modestly supportive. Private consumption support has toned down, yet the labor market should continue to provide solid backing, mostly owing to still-solid wage growth (employment is looking more flattish as the unemployment rate hits all-time lows). Moderating inflation since the 2Q peak should also allow for some recovery in real disposable income and real retail trade figures. Consumer credit remains solid, yet is showing some signs of moderation. […] Heading into 2027, EU funding support should lose momentum, the extent of which will depend on how quickly absorption from the MFF 2021–27 can be ramped up. As external demand goes, tourism is under the spotlight in 3Q. Overnight stays and what we can depict from tax authority data bode well with our expectations of, at best, a relatively neutral direct tourism contribution to the headline figure.”

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