Estonia's 4.5 percent economic growth in the first quarter of 2019 strongly exceeded the expectations of analysts who as recently as Thursday were still predicting economic growth for the quarter to total 3-3.5 percent.
According to information released by Statistics Estonia on Friday morning, Estonia's GDP grew 4.5 percent on year in the first quarter of 2019, totaling €6.7 billion at current prices.
LHV analyst Kristo Aab still believed on Thursday that economic growth would remain between 3-3.5 percent in the first quarter, due in part to the deceleration of the growth of construction volumes, which was presumed would have an impact on general economic growth as well.
Swedbank chief economist Tõnu Mertsina, meanwhile, had forecast that economic growth would remain close to 3 percent. Mertsina believed that, in addition of the deceleration of the growth of construction volumes, economic growth would also be slowed by the deceleration of the growth of VAT receipts and the decrease in excise duties.
Luminor chief economist Tõnu Palm had estimated that growth would remain strong at 3.2 percent in the first quarter, but would be more moderate than before. According to the Luminor economist, the economic growth of the euro area slightly exceeded analyst expectations, growing on average at a similar tempo to Finland, for example, i.e. 1.2 percent on year.
"Thus, deceleration is definitely this year's theme, and will be increasingly noticeable in neighboring countries as well," Palm said on Thursday. "Growth figures beginning with the number 3 are definitely good when it comes to Estonia, while 4-percent growth can only be short-term, and is usually accompanied by hidden risks."
Editor: Aili Vahtla