South-Eastern Europe Economic Outlook
Our panelists have downgraded their 2026 GDP growth forecasts in recent weeks in response to the soft Q1 outturn. Most economies are set to lose steam this year vs 2025, with only those of Bosnia-Herzegovina, Montenegro and Serbia seen accelerating. Prolonged shipping disruptions in the Hormuz Strait and further increases in U.S. tariffs are key downside risks.
South-Eastern Europe Inflation
So far this year, regional inflation has continued 2025’s three-tier profile—over 30% in Turkey, around 10% in Romania and 2–7% elsewhere. Price pressures have spiked in all economies since February due to the surge in global energy prices, though the reduction in energy prices since the mid-June U.S.-Iran peace memorandum should dampen regional inflation ahead.
This chart displays Economic Growth (Real GDP, ann. var. %) for South-Eastern Europe from 2010 to 2025.
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| Unemployment (% of active population, aop) | 10.7 | 9.4 | 8.6 | 8.0 | 7.7 |
| Industrial Production (ann. var. %) | 10.9 | 3.7 | 0.5 | 0.4 | 1.9 |
| Fiscal Balance (% of GDP) | -4.2 | -2.2 | -4.3 | -4.3 | -3.1 |
| Public Debt (% of GDP) | 64.7 | 54.7 | 50.6 | 46.0 | 45.1 |
| Inflation (CPI, ann. var. %, aop) | 11.5 | 43.7 | 33.0 | 34.8 | 22.2 |
| Economic Growth (Real GDP, ann. var. %) | 9.8 | 5.2 | 3.9 | 2.9 | 2.9 |
| Fixed Investment (ann. var. %) | 7.8 | 7.2 | 8.9 | 2.2 | 6.4 |
| Private Consumption (ann. var. %) | 11.4 | 11.7 | 6.7 | 4.3 | 3.4 |
| Policy Interest Rate (%, eop) | 7.48 | 6.72 | 25.77 | 29.13 | 23.87 |