The rate of savings on the decline for the first time since the onset of the crisis

In the third quarter of 2011, savings, as a share of GDP, declined for the first time since the onset of the crisis, according to a macroeconomic report of Raiffeisenbank (Bulgaria).

The data confirmed the already noted revival in consumption. The bank’s economists established a change in the growth structure of the Bulgarian economy, as domestic demand was considered the main engine of the expansion. Domestic demand recorded an increase of 5% annually, which was the biggest raise in the indicator since the end of 2008. Despite the rapid increase in the indicator in the third quarter of 2011, its level was still substantially lower, compared to the recorded figures before the crisis. According to experts, the overall economic recovery and revitalisation of the labour market will depend on increased consumption.

Inflation was surprisingly low in November as well. Such dynamics has not been recorded in previous years, stated Raiffeisenbank experts. “It would be difficult to argue, however, that a sharp decline in demand was the reason for this development,” stated the specialists. According to the report, the trade balance was negative in October due to a substantial increase in imports. It is therefore logical that the GDP data for the fourth quarter of 2011, which is due to be published, will show a continuing recovery in domestic demand. “Amid the turmoil in Europe, the economic development in the country appears stable, although far from perfect,” said Kaloyan Ganev, Chief Economist at the bank.

“Public finances are in a very good condition, labour productivity has been increasing over six consecutive quarters by more than 5%, on an annual basis and demand has shown signs of recovery. The positive growth rates of GDP, however, should not be exaggerated because there are still serious problems in the economy that have not been addressed properly,” stated Ganev.

Прочети цялата новина

Свързани новини: