Bulgaria Economic Forecast

Bulgaria Economic Outlook

May 8, 2018

Following a strong start to the year, available data suggests the economy slowed somewhat by the end of the first quarter on easing consumption and industry metrics. Household spending, a linchpin of growth last year despite a slowdown in the fourth quarter, appears to have lost further momentum given underwhelming retail sales through February. Furthermore, consumer sentiment, which hit a one-decade high in February, cooled in March and April. That said, it remained elevated, and low unemployment was broadly stable from the fourth quarter, suggesting any moderation in household spending is likely to be modest. Meanwhile, industrial output posted a rare annual contraction in February on weakness in the utility and extractive sectors; manufacturing, on the other hand, was resilient. Furthermore, elevated business confidence readings in recent months suggest fixed investment continued supporting growth at the outset of the year, building on last year’s strong absorption of EU-linked funding.

Bulgaria Economic Growth

Household spending should benefit this year from a tight labor market and public-sector wage hikes, although inflation will eat into gains somewhat. An improving business climate and low interest rates bode well for investment, while EU-funded outlays will lend support to growth over the medium term. Furthermore, sound public finances should attract stronger FDI inflows, while upbeat growth across the EU is expected to bolster exports. Met the why particular Consensus Forecast panelists expect the economy to grow 3.7% in 2018, unchanged from last month’s forecast, and 3.3% in 2019.

Bulgaria Economy Data

20132014201520162017
Population (million)7.27.27.27.17.1
GDP per capita (EUR)5,7905,9376,3306,657-  
GDP (EUR bn)41.942.845.347.4-  
Economic Growth (GDP, annual variation in %)1.32.43.63.4-  
Consumption (annual variation in %)-2.22.53.92.1-  
Investment (annual variation in %)0.33.42.7-4.0-  
Industrial Production (annual variation in %)-0.21.82.95.2-  
Retail Sales (annual variation in %)3.811.211.83.9-  
Unemployment Rate11.811.711.08.0-  
Fiscal Balance (% of GDP)-0.4-5.5-1.60.0-  
Public Debt (% of GDP)17.027.026.029.5-  
Money (annual variation in %)9.01.28.87.6-  
Inflation Rate (CPI, annual variation in %, eop)-1.6-0.9-0.40.1-  
Inflation Rate (HICP, annual variation in %)0.4-1.6-1.1-1.3-  
Inflation (PPI, annual variation in %)-1.3-0.9-1.7-2.8-  
Policy Interest Rate (%)0.020.020.03-0.21-  
Stock Market (annual variation in %)42.36.2-11.727.2-  
Exchange Rate (vs EUR)1.961.961.961.96-  
Exchange Rate (vs EUR, aop)1.961.961.961.96-  
Current Account (% of GDP)1.30.1-0.14.2-  
Current Account Balance (EUR bn)0.50.0-0.12.0-  
Trade Balance (EUR billion)-2.9-2.8-2.6-1.8-  
Exports (EUR billion)21.221.021.922.6-  
Imports (EUR billion)24.223.824.524.4-  
Exports (annual variation in %)7.8-0.94.22.9-  
Imports (annual variation in %)2.0-1.43.1-0.6-  
International Reserves (EUR)14.416.620.323.9-  
External Debt (% of GDP)88.091.974.973.1-  

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Bulgaria Facts

ValueChangeDate
Bond Yield1.250.0 %May 21
Bond Yield1.250.0 %May 21
Exchange Rate1.66-0.72 %May 21
Exchange Rate1.66-0.72 %May 21
Stock Market646-0.35 %May 21
Stock Market646-0.35 %May 21

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