Slovenia Government Consumption

Economic growth accelerates in Q2 2026

GDP growth picks up: Slovenia's GDP increased 5.0% on a year-on-year basis in Q2, following already solid 3.2% growth in the previous quarter, marking an increasingly sharp recovery after two years of subdued economic growth. The reading was the strongest since Q1 2022 and among the fastest in the euro area, beating market expectations. On a seasonally adjusted quarter-on-quarter basis, GDP expanded 1.8% in Q2, following 1.1% growth in the previous quarter.

Domestic demand continues to spearhead GDP growth: Relative to the prior period's data, readings in Q2 improved for private consumption (+3.4% in annual terms vs +2.8% in Q1), exports of goods and services (+6.4% vs +2.3% in Q1) and imports of goods and services (+7.6% vs +3.4% in Q1). In contrast, the reading for government consumption softened in Q2 (+5.2% vs +5.6% in Q1). Finally, the variation in fixed investment was the same as in the prior quarter (+13.2% in Q2 and Q1). Fixed investment was again the main bright spot, driven by government infrastructure projects and supported by the completion of EU-funded schemes under the Recovery and Resilience Plan. Moreover, private consumption growth picked up as solid real wage growth and favorable labor market conditions offset higher inflation. Finally, government consumption growth remained firm, driven by greater use of long-term care benefits and rising public-sector employment. Net trade, however, continued to weigh on GDP growth.

Economy to decelerate in Q3: Q2’s strong momentum is expected to fade in Q3. Above-target inflation should weigh on private consumption growth, while persistent geopolitical uncertainty in the Middle East will likely weaken private investment. Additionally, drought across Europe should start hurting the economy in Q3, adding another drag.

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Slovenian government consumption projections for the next ten years from a panel of 13 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable government consumption forecast available for Slovenian government consumption.

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