Slovak Central Bank Downgrades Economic Growth Outlook Amid Escalating Trade War

Strategic Insights -

The Slovak central bank (NBS) has revised its forecast for the country's economic growth in 2023, citing rising concerns over the impact of the ongoing trade war. The NBS has downgraded its expectation from 1.9 percent to 1.2 percent, with concerns that the situation could worsen further. The trade war is already affecting the labor market, with negative effects being felt from the lower demand for Slovak exports. NBS governor Peter Kazimir emphasized that the country's economy faces a challenging period ahead, with a risk of higher trade barriers and potential job losses.

Key Takeaways:

  • The Slovak central bank has downgraded its economic growth outlook for 2023 from 1.9 percent to 1.2 percent, citing concerns over the trade war.
  • The trade war is affecting the labor market, with negative effects being felt from lower demand for Slovak exports.
  • NBS governor Peter Kazimir warned that the country's economy faces a challenging period ahead, with a risk of higher trade barriers and potential job losses.
  • An escalation of the trade war could lead to another 17,000 to 21,000 jobs being at risk by 2027 in the Slovak economy.
  • The country's unemployment rate is expected to increase from 5.3 percent in 2023 to 6 percent by 2027.
  • The NBS has downgraded its economic growth forecast for 2024 to 1.6 percent from 1.9 percent.

Statistics:

  • The Slovak central bank has downgraded its economic growth outlook for 2023 from 1.9 percent to 1.2 percent.
  • The trade war is expected to lead to a 0.7 percent decline in economic growth for the Slovak economy in 2023.
  • 17,000 to 21,000 jobs are at risk of being lost in the Slovak economy by 2027 due to the trade war.
  • The country's unemployment rate is expected to increase from 5.3 percent in 2023 to 6 percent by 2027.
  • The NBS expects lower inflation in 2024, leading to a slightly higher increase in the purchasing power of employed people.

Sources:

  • [CTK correspondent, Bratislava, June 24, 2023]
  • [Slovak News Agency, Bratislava, June 2023]