Nordea Lowers 2013 GDP Forecast to 2.3% ({{commentsTotal}})

Source: Photo: Postimees/Scanpix

Nordea Eesti today became the latest financial institution to downgrade its forecast for the country's 2013 economic growth, now pegging it at 2.3 percent compared with the 3.2 percent it was predicting in March.

In a statement that accompanied the release of its Estonian Review report today, the bank said that the change was based on a combination of lower investment volume - citing less spending of carbon emissions credits and EU structural funds - and weaker export markets.

At the same time, it said the growth slowdown would be temporary, and expects next year's growth to come in at 3.6 percent.

Inflation, it said, would be 3.3 percent this year and 3 percent in 2014, while unemployment would drop to 9.4 percent this year and 8.6 percent next year.

Economists were disappointed in May when Statistics Estonia reported worse-than-expected first quarter GDP growth, a figure that has now been revised to 1.1 percent.

Last week, the Bank of Estonia downgraded its 2013 economic growth projection from the 3 percent forecast it released last December to 2 percent. The OECD had already lowered its forecast from 3.7 to 1.5 percent.