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Central bank lowers Slovakia’s GDP growth estimate

Amid fears of a deceleration in global economic growth, Slovakia’s economy is now expected to grow by only 3.4 percent in 2011 and by 3.8 percent in 2012, according to a lowered forecast by the National Bank of Slovakia (NBS), the TASR newswire reported.

Amid fears of a deceleration in global economic growth, Slovakia’s economy is now expected to grow by only 3.4 percent in 2011 and by 3.8 percent in 2012, according to a lowered forecast by the National Bank of Slovakia (NBS), the TASR newswire reported.

While the prediction for economic growth for this year was decreased by 0.2 percentage points, the prognosis for next year dropped by about 0.9 percentage points. NBS governor Jozef Makúch explained that the drop was caused by lower expected growth in foreign demand and by lower household consumption. The new prognosis was also affected by measures associated with the consolidation of public finances.

Though the current prediction counts on the stabilisation of financial markets, the NBS admits that developments are uncertain and many risks still exist.

“The most significant risk is a continuation in the current drop in economic sentiment affected by the situation on the financial markets in the eurozone and following deceleration of global economic growth,” Makúch said, as quoted by the SITA newswire. However, he said he did not think that the deceleration signalled a new recession.

The NBS is the second official institution to lower its estimates due to a deceleration in the global economy. At the end of August, the Finance Ministry decreased its estimate for 2011 to 3.3 percent and for next year to 3.4 percent, representing a cut of 1 percentage point.

The average estimates of analysts at commercial banks are even more pessimistic: 2.9-percent growth for this year and 2.7-percent growth in 2012.

Sources: TASR, SITA

Compiled by Radka Minarechová from press reports
The Slovak Spectator cannot vouch for the accuracy of the information presented in its Flash News postings.

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