The Central Bank of Slovenia published its Review of Macroeconomic Developments, reporting that domestic growth substantially exceeded expectations in the second quarter and likely continued at a slower pace in the third quarter. Gross domestic product rose 1.8% quarter-on-quarter and 5.0% year-on-year, supported by consumption, investment and construction linked to government infrastructure projects. Short-term models estimate quarterly growth of 0.5% in the third quarter. Headline inflation increased to 3.4% in August, driven mainly by energy prices, while higher energy costs and an exceptionally dry summer could accelerate food inflation. The review finds that energy price increases caused by constrained supply have substantially more adverse economic effects than increases driven by stronger global demand, weakening purchasing power, profitability, competitiveness and investment. Monetary policy can limit inflation persistence but cannot fully offset the direct effects, leaving limited scope for mitigation and requiring coordination across policy areas.
2026-09-03Central Bank of Slovenia
Central Bank of Slovenia reports stronger-than-expected growth, flags persistent inflation risks from energy prices
The Central Bank of Slovenia reported stronger-than-expected second-quarter GDP growth of 1.8% quarter-on-quarter and 5.0% year-on-year, with its models indicating 0.5% growth in the third quarter. Inflation rose to 3.4% in August, while supply-driven energy price shocks pose particularly severe risks to activity and inflation persistence.