Bulgaria: Prices Will Rise More Steeply than Expected - Finance Ministry
The Ministry of Finance has revised its autumn forecast for economic development. According to new estimates, real gross domestic product (GDP) growth will reach 4%, and next year will be heading towards 5% with a forecast of 4.9%. The main reason for accelerating economic growth will be investment, as well as the stabilization of the private sector after the Covid crisis.
At the same time, however, a slowdown in income growth is expected, which will also reduce the rate of consumption by households, according to data from the Ministry of Finance. The average annual number of employed will remain almost at the level of the previous year - with an increase of 0.1%. However, this indicator is expected to improve significantly over the next three years.
The ministry has also revised its forecast for higher prices for oil and non-energy raw materials by the end of the year. Their prices will increase by more than expected in the spring. Growth in the overall level of consumer countries will continue to accelerate, with inflation reaching 3.8% by the end of the year. Separately, the risk of an even greater increase in international prices of raw materials and goods is increasing.
The forecast for credits for 2021 has been revised upwards (compared to the spring). The annual growth of receivables from enterprises is projected to be around 4.1%, and of receivables from households - 10.3%. Credit to non-financial corporations will accelerate in the period 2022-2023, in line with the recovery of private investment.
The presented forecast depends on the development of the epidemic situation both in the country and in the world, the Ministry of Economy explains. An important prerequisite for it happening is the maintenance of relatively low levels of virus spread and limited impact of the pandemic on the economy./BNT
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