GDP growth decelerated further to 1.7 % in Q3
growth disappointed again and according to the flash estimate economy picked up
by 1.7% in the third quarter of this year compared with the same period a year
ago. Quarterly growth decelerated from 0.4% in the second
quarter to 0.1% in the third quarter.
weak growth was unexpected as retail trade growth did not subside in the third
quarter and export performance also improved in August and most likely even
more so in September as manufacturing production suggests. However, investment
growth most likely did not rebound as expected and inventories must have
remained weak as well.
sentiment indicator in October declined but remained higher than a year ago,
however, industrial confidence fell slightly below the previous year level. Retail
trade confidence worsened significantly, but remained higher than a year ago. However,
households became more optimistic.
Outlook: stronger growth ahead
Household consumption will remain one of the main
growth drivers, but will ease as real wage bill growth subsides. Capacity utilisation for the
industrial sector is record high and growth in main export markets is expected
to remain stable while negative effect due to Russian crisis fades away. Therefore
we expect investment to recover and export growth to continue. We expect GDP growth to accelerate to 3% in 2017.
For more information about this report, please contact Ms. Vaiva Šečkutė, +370 5
258 2156, Vaiva.Seckute@swedbank.lt
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