Supply disruption and fewer energy resources: stagnation is the watchword
In Latvia, the second half of this year and the beginning of 2023 will see an even stronger slowdown of economic growth and energy resources.
In Latvia, the second half of this year and the beginning of 2023 will see an even stronger slowdown of economic growth and energy resources.
Elevated inflation is weighing on the propensity to consume and keeps undermining the purchasing power, while GDP growth decelerates.
Estonia has to cope with very high inflation and a recession in the second half of the year when the economy will decline by 3%. Perfect economic storm.
Lithuania’s growth forecast is revised down. Increased prices of food and energy slow down growth in trading partners, when it’s necessary to cut market distortions.
Despite retail sales in Poland rising by 4.2% YoY in August, with the inflationary everything-bubble prospects for upcoming quarters are deteriorating.
In Latvia, the average remuneration has risen by 8.3% YoY, but this rate is insufficient to offset the price surge (+16.4%). Free-market allocation is much needed.
In Estonia, the consumer basket price was 24.8% higher YoY. Orders have declined, making harder to pass the higher costs to the final products. Competitiveness is at stake.
Despite a slight increase in interest rates, the amount granted by credit institutions to Lithuanian residents increased by €306.0 million.
Polish industrial production grew by 7.6% YoY, thus decelerating rapidly in recent months. The economy and the labor market must adjust to a new energy shock.
In Latvia, the State programme for house purchase provides a boost to the price increase, lowering the effectiveness of the macroprudential policy.