In the second quarter of 2019, GDP of the Republic of Slovenia increased by 2.5% over the second quarter of 2018. As a reminder in Q1, GDP observed an increase of 3.3%.
According to the Statistical Office of Slovenia, domestic expenditure showed its strength increasing by 4.2% YoY and confirming that slowdown of domestic demand observed in the first quarter was a one-off event. Namely, households’ consumption increased by 3.4% YoY while investment growth once again came close to double digits (+9.2% YoY), the trend which we expect to continue at least throughout 2019. Government expenditure growth was very modest, rising only 1.0% YoY, compared to an average growth of above 3.0% in the last several quarters, suggesting another surplus of Slovenian budget for 2019. Exports of goods and services jumped by 9.4% YoY, accelerating by 1.5 pp compared to Q1. However, on the other side, imports surged by 12.3% YoY driven by strong domestic demand resulting in negative contribution from external trade balance which is the one to blame for deceleration of GDP in the second quarter.
Looking at other CEE GDP data that were published this week, Slovenia was not an exemption in a sense that domestic demand keeps rising at strong pace due to solid rise of employment and wages, loose monetary policy and strong investment cycle. However, external demand decelerated and due to several geo-political challenges, we don’t expect this to reverse any time soon. It remains to be seen can domestic demand keep the pace and for how long.
| wdt_ID | Slovenian GDP | Q2 2018 | Q1 2019 | Q2 2019 |
|---|---|---|---|---|
| 1 | Domestic expenditure | 3,5 | 2,7 | 4,2 |
| 2 | Final consumption expenditure | 3,2 | 2,7 | 2,7 |
| 3 | -Households | 3,3 | 2,3 | 3,4 |
| 4 | -NPISH | 2,5 | 1,2 | 0,1 |
| 5 | -General government | 3,1 | 3,9 | 1,0 |
| 6 | Gross capital formation | 4,2 | 2,5 | 9,2 |
| 7 | -Gross fixed capital formation | 9,1 | 10,0 | 6,9 |
| 8 | -Changes in inventories and valuables | 0,8 | -1,3 | 0,6 |
| 9 | External trade balance | 0,6 | 0,8 | -1,3 |
| 10 | Exports of goods and services | 8,2 | 7,9 | 9,4 |
| 11 | -Goods | 8,4 | 8,2 | 10,0 |
| 12 | -Services | 7,2 | 6,6 | 6,7 |
| 13 | Imports of goods and services | 8,4 | 7,7 | 12,3 |
| 14 | -Goods | 8,7 | 7,9 | 13,8 |
| 15 | -Services | 6,8 | 5,8 | 2,8 |
| 16 | GDP | 3,7 | 3,3 | 2,5 |
Source: Statistical Office of Slovenia
