Economic Monitor Issue 14 | June 2021


  • Real GDP will continue to contract in 2021 (-0.4%) despite global recovery, with forecast uncertainty remaining high
  • In sectoral perspective, the development (5M2021) is extremely heterogeneous: manufacturing +11.6%; construction -14.1%
  • Inflation currently at 9.4% (May-21), well above the target set by the National Bank, which reacted late by raising interest rates to 8.5%. Slight decline in inflation expected towards the end of 2021
  • Strong depreciation of the exchange rate in 2020 (-21%), currently some stabilisation. International reserves at USD 7.8 bn in May-21; import cover remains low (2.4 months)
  • Budget deficit will widen to -3.8% of GDP in 2021, but decline in debt ratio to 45.7% of GDP expected; options for refinancing remain limited
  • Current account deficit of -0.3% of GDP in 2021 remains roughly at previous year’s level
  • After foreign trade contracted in 2020, there is currently (4M2021) a strong recovery due to base and price effects (exports +35%, imports +25%)

Special topics

Government financing. Eurobond yields reflect the uncertainty of the current situation
Administrative price regulations. Such measures are not the right instrument for tackling inflation
Export financing. Timid reform of state export financing initiated
COVID-19. Decreasing case numbers, but still quite high incidence. So far, barely any vaccinations

Download Economic Monitor 14/2021