South-Eastern Europe Economic Outlook
Economic growth will roughly halve this year relative to 2022. Stubbornly high inflation and tighter financing conditions will weigh on domestic activity, while global headwinds will hamper exports. Key factors to monitor are the return to economic orthodoxy in Turkey, the health of the Eurozone economy, ethno-nationalistic tensions and the evolution of the war in Ukraine.
South-Eastern Europe Inflation
In July, inflation softened in all countries except heavyweights Turkey and Greece; as a result, regional inflation rose to 31.2% (June: 26.0%). Inflation is seen falling marginally from current levels by year-end thanks to softer demand amid tighter monetary policy. A stronger-than-expected pickup in Turkish inflation poses an upside risk to the outlook.
This chart displays Economic Growth (GDP, ann. var. %) for South-Eastern Europe from 2010 to 2022.
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Economic Growth (GDP, ann. var. %) | 3.4 | 2.0 | -1.7 | 9.5 | 5.2 |
| Private Consumption (ann. var. %) | 2.7 | 2.3 | -0.6 | 11.5 | 12.8 |
| Fixed Investment (ann. var. %) | 0.5 | -3.3 | 3.8 | 7.2 | - |
| Industrial Production (ann. var. %) | 2.2 | -1.1 | -1.6 | 13.2 | 3.8 |
| Unemployment (% of active population, aop) | 11.5 | 12.2 | 12.1 | 11.0 | - |
| Fiscal Balance (% of GDP) | -1.3 | -2.0 | -5.8 | -4.2 | - |
| Public Debt (% of GDP) | 56.9 | 56.7 | 66.6 | 65.8 | - |
| Inflation (CPI, ann. var. %, aop) | 9.7 | 8.8 | 6.6 | 11.3 | 43.2 |
| Base Rate (%, eop) | 17.71 | 9.08 | 12.06 | 10.04 | 8.15 |
| Exchange Rate (KZT per USD, eop) | 9.27 | 9.83 | 10.42 | 14.15 | 17.32 |