Ljubljana [Slovenia], December 17: The Bank of Slovenia on Friday slashed its forecast for gross domestic product (GDP) growth for 2023 to 0.8 percent, from a 2.4 percent forecast in June.
It also said GDP growth this year will be 5 percent rather than the 5.8 percent the bank forecasted earlier. This is well below the growth of 8.2 percent in 2021.
"Next year we expect a slowdown of economic growth mainly due to significantly lower household spending and lower private investment," the bank said in a statement.
It said the expected slowdown reflects deteriorating macroeconomic conditions in the international environment, where interest rates are rising at the same time as worsening financing conditions.
The bank sees household spending up by only 0.5 percent in 2023, versus 8.3 percent this year, while investment growth is seen at 1.3 percent in 2023, down from 10 percent this year.
According to the bank, inflation will remain high in the coming year, particularly due to the growth of food prices, and the transfer of higher energy prices into other price groups.
The bank sees the average annual inflation rate at 6.8 percent in 2023, compared to 9.3 percent this year. It expects inflation to further ease to 4.2 percent in 2024.
Source: Xinhua
