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NBS predicts slower economic growth and increasing unemployment

The Slovak GDP will rise by only 1.6 percent next year, compared to the 2.4-percent growth predicted for this year, according to the latest information released by the National Bank of Slovakia (NBS), the country’s central bank.

The Slovak GDP will rise by only 1.6 percent next year, compared to the 2.4-percent growth predicted for this year, according to the latest information released by the National Bank of Slovakia (NBS), the country’s central bank.

“We are expecting a higher GDP growth rate of 3.5 percent in 2014, which should be due to an influence of stronger foreign and domestic demand,” said NBS governor Jozef Makúch, as quoted by the TASR newswire, at a press conference in Bratislava held on December 7.

The bank has trimmed the GDP growth expectation for next year by 0.4 percentage points due especially to weaker foreign demand and negative trends seen in preliminary indicators. This negatively affects the prospects of the Slovak labour market, which is also expected to deteriorate, TASR wrote.

High unemployment and a relatively low growth of salaries should continue to inhibit consumer demand as well as inflation pressures, therefore the NBS expects inflation to decelerate next year and in 2014 as well.

“Inflation should at the beginning of the year reach around 2 percent,” NBS vice-governor Ján Tóth stated, as quoted by TASR, adding that the prediction for next year stands at 2.3 percent after this year’s 3.8 percent.

The predictions of NBS for this year’s unemployment rate reach 14 percent, with further growth to 14.5 percent foreseen in 2013 and a slight drop to 14.1 percent expected in 2014, TASR reported.

Source: TASR

Compiled by Radka Minarechová from press reports

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