SEB Pares Back Modest Growth Projection Even Further ({{commentsTotal}})

Source: Photo: Postimees/Scanpix

Commercial bank SEB has cut its estimate for this year's GDP growth to 1.3 percent, down from 1.5 percent in August and 3.3 percent in the spring.

SEB's projection is among the lowest ones, with the Ministry of Finance calling for 1.5 percent, Swedbank and Nordea holding at 1.9 percent and the Institute of Economic Research advancing 2.0 percent.

Ernst & Young, however, was at the bottom of the range with 1 percent, a projection made in mid-September. 

SEB's updated figure is from its Eastern European Outlook, published today. It added that next year would be a period of healthier export in contrast to internal demand this year. 

SEB said next year's growth would be 2.6 percent, and 2.9 percent in 2015. 

Inflation numbers for this year and the next two years will be 3.2 percent, 2.7 percent and 2.6 percent, the bank said. 

The bank said the Center Party and Social Democrats had increased in popularity, which it attributed to social tension. Fear of better performance at the polls by the Social Democrats had led the government to increase social sector spending, SEB said.