Ljubljana, 12 September (STA) - IMAD, the government's macroeconomic forecaster, has sharply downgraded the GDP growth forecast for this year. It expects the economy to grow at a pace of only 1.5%, down from its spring forecast of 2.4%. For next year it reduced the forecast by just 0.1 points, to 2.4%.
The downgrade is based on expectations that export growth will be lower than forecast in spring, due to weaker foreign demand and higher unit labour costs.
Government investment, among the highest in the EU as a share of GDP, is projected to outpace last year's, but private investment spending is expected to stagnate.
On the other hand, both private and government consumption remain robust.
Average annual inflation is projected to stand at 2.1% this year, down by 0.6 percentage points compared to the spring forecast, but tick up again, to 3.3%, next year.
