IMF lowers 2018 economic growth forecast to 3.7%

The International Monetary Fund.
The International Monetary Fund. Source: Reuters/Scanpix

The International Monetary Fund (IMF) has lowered the growth estimate for Estonia's GDP by 0.2% to 3.7% for 2018.

The IMF left the growth estimate on Estonia for 2019 unchanged at 3.2%.

On the global economy, the IMF said that while the steady expansion underway since mid-2016 continues, with global growth for 2018-2019 projected to remain at its 2017 level, the expansion has become less balanced and may have peaked in some major economies. Downside risks to global growth have risen in the past six months, and the potential for upside surprises has receded. Global growth is projected at 3.7% for 2018-2019 — 0.2% lower for both years than forecast in April.

The IMF outlook holds out the same rates of growth for both the global and the Estonian economy for 2018.

The growth outlook for Latvia for 2018 was lowered by 0.3% to 3.7% and for 2019 cut 0.2% to 3.3%. The outlook on Lithuania, meanwhile, was raised by 0.2% to 3.5% for this year and lowered by 0.1% to 2.9% for 2019.

The economy of the euro area is estimated to grow 2% in 2018 and 1.9% in 2019.

Inflation is forecast to hit 3% in Estonia this year and to decelerate to 2.5% in 2019. In Latvia, the estimated ratios are 2.7% for 2018 and 2.4% for 2019, and in Lithuania 2.5% and 2.2%.

Unemployment in Estonia is estimated to grow 0.9% to 6.7% this year and hit 6.9% in 2019. Latvian unemployment, meanwhile, is set to drop 0.8% to 7.9% this year and to 7.8% next year, while the unemployment rate in Lithuania is expected to drop 0.6% to 6.5% in 2018 and to 6.3% in 2019.


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Editor: Aili Vahtla

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