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Erste affirms Slovenia’s 2019 GDP growth forecast at 3.2%

Erste affirms Slovenia’s 2019 GDP growth forecast at 3.2% Source: Slovenian government

LJUBLJANA (Slovenia), June 12 (SeeNews) – Erste Group said on Wednesday it keeps unchanged its forecast for Slovenia's economic growth in 2019 at 3.2%, with risks mainly linked to external uncertainties.

Following a period of high GDP growth rates, the headline figure entered 2019 on an expected cooldown, with growth decelerating to 3.2% in the first quarter of the year from 4.1% in the previous quarter, the Erste Group said in a statement.

“However, the growth slowdown mainly came at the cost of negative inventories performance, as the detailed structure revealed steady support from domestic demand, but also resilient exports growth, which ensured a positive net exports contribution,” the banking group said.

“Going forward, we see the growth rate remaining at similar levels,” Erste said, adding that the structure should bring no major changes, with the exception of a diminishing role of exports amid slower growth in Slovenia’s main export markets.

Erste also noted that Slovenia's inflation is expected to remain steady throughout the remainder of 2019, with strengthening domestic demand generating upside pressures, while cost-side drivers should have a somewhat more moderate impact.

“Fiscal trends are seen as remaining on a positive track, with the 2019 budget figure expected to bring another surplus amid continued tax revenues growth,” Erste said. “Such developments are welcomed by the rating agencies, with S&P affirming its rating at A+ (positive outlook), while Moody’s upgraded Slovenia’s outlook from stable to positive, while also affirming its rating at Baa1.”