Swedbank, one of the biggest financial groups in the Baltics, sticks to its forecast that Lithuania will post the highest 2019 GDP growth rate in the region.
Atidarytas antrasis verslo centro „Park Town“ pastatas / Darnu Group nuotr.
© Bendrovės archyvas

In its latest Economic Outlook report published on Thursday, Swedbank kept its Lithuanian economic growth projections unchanged from those released in late August, but revised down its forecasts for Estonia and Latvia.

It expects Lithuania's economy to expand by 3.7 percent this year. The 2019 growth forecast for Estonia was lowered to 3.2 percent, from 3.3 percent, and that for Latvia was cut to 2 percent, from 2.8 percent.

Lithuania's GDP growth is forecast to decelerate to 2 percent next year before picking up to 2.5 percent in 2021.

Latvia's economy is also expected to expand by 2 percent in 2020 and by 2.5 percent in 2021, unchanged from the previous estimates. Estonia's GDP growth forecast for 2020 was revised down to 2.1 percent, from 2.3 percent in August, but the 2021 estimate is unchanged at 2.5 percent.

Swedbank slightly lowered its forecast for Lithuania's average annual inflation in 2019, from to 2.5 percent to 2.4 percent, but kept the 2020 estimate unchanged at 2.5 percent.

Latvia's inflation is forecast to reach 2.9 percent this year before easing to 2.4 percent next year, unchanged from the previous estimates. Estonia's inflation is projected at 2.4 percent in 2019 (up from the 2.3 percent forecast in August) and 2.3 percent in 2020 (unchanged).

Unemployment in Lithuania is projected at 6.2 percent in both 2019 and 2020, up from the previous estimates of 5.7 percent and 6 percent, respectively. The forecasts for Latvia are unchanged at 6.5 percent and 6.6 percent, respectively, and those for Estonia are unchanged at 4.9 percent and 5.1 percent, respectively.

Lithuania's average wage growth is expected to reach 8.3 percent this year before moderating to 6.1 percent next year. The wage growth forecasts for Latvia are 7.6 percent and 6 percent, and those for Estonia are 7.5 percent and 6.5 percent, respectively.

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