Bulgarian National Bank Lowered Its Expectations for Economic Growth in 2018

The Bulgarian National Bank cut its expectations regarding the vision for the Bulgarian economy in 2018. In December, experts relied on gross domestic product growth of 4.2%, however, now it was set at 3.9%, Capital reported.

Expectations are for the exports to accelerate their growth rate, but more moderate than imports, while the rise in domestic prices will accelerate. The basic inflation will also rise sharply, mainly due to the price of the services. Credit interest rates are expected to rise slightly in 2019 and 2020.

In the next two years, economic growth will remain around 4%, according to the Bank's estimates, with the domestic demand remaining the main driving force. The labor market is contributing to the growth of consumption - more people find jobs and unemployment is declining. At the same time, according to the latest NSI data, the reason is not the new jobs, but the declining number of the economically active population in Bulgaria.

The BNB points to strong demand for goods and services, and high capacity utilization as a reason to expect higher private investment this year.

Petya Petrova

Petya Petrova is a journalist, believer, and traveler.

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