The Lithuanian Economy - March 9, 2012
Growth surprises this year, but we are not out of the woods yet
- Annual GDP growth in Lithuania decreased from 6.7% in the third quarter of 2011 to 4.4% in the last quarter. Consumption and investments were and are expected to remain the most important drivers of growth.
- In January 2012, compared with the same period a year ago, not only did retail trade increase its rate of growth to 16.4%, but manufacturing production, except for refined petroleum products, also bounced back to annual growth of 10.7%. More importantly, in January annual export growth accelerated to 13.3%, up from 11.2% in December.
- Continued recovery of the labour market, lower inflation and increasing real purchasing power will contribute to consumption growth this year. However, there is a risk that inflation this year will be higher than currently anticipated.