The Central Bank of Slovenia published its April 2026 Review of macroeconomic developments, reporting that Slovenia’s economy continued to expand in the first quarter of 2026 but showing signs of slowing domestic consumption and persistently weak industrial production. Inflation eased in March, while the war in the Middle East is currently showing up mainly in higher consumer inflation expectations, with the report warning that broader economic effects could strengthen later in the year. Banka Slovenije’s nowcast put quarterly GDP growth at 0.4%, with year-on-year growth lifted by a low base. Industrial weakness was partly linked to falling pharmaceutical output, and external risks included weaker foreign demand, rising bankruptcies in key European partners, and intensifying competitive pressure from China across goods of different technological intensity. Employment was broadly flat year on year, with growth in older workers underpinning overall dynamics; wage growth accelerated in January, largely reflecting a 16% rise in the minimum wage, adding to cost-competitiveness pressures given earlier labour cost growth and weak productivity. Headline HICP inflation slowed to 2.4% in March, driven mainly by lower annual food and energy inflation, with electricity prices a key factor and fuel-price pass-through partly constrained by government measures and price regulation early in the month; higher wholesale energy and fertiliser prices were highlighted as a risk to inflation expectations. On public finances, the report noted that the general government deficit widened to 2.5% of GDP in 2025 while government debt fell to 65.7% of GDP due to nominal growth effects. Expenditure growth was attributed primarily to social security benefits, employee compensation and investment, with investment reaching a record-high share of GDP. The war in the Middle East was flagged as worsening the fiscal outlook through its effects on growth and through measures to mitigate higher energy prices, which the report said should be temporary and targeted at vulnerable groups and energy-intensive sectors to preserve fiscal sustainability and space.
Central Bank of Slovenia 2026-04-21
Central Bank of Slovenia macro review points to continued Q1 growth, weak industry and March HICP inflation easing to 2.4%
The Central Bank of Slovenia’s April 2026 Review reports continued GDP growth in Q1 2026 but slowing domestic consumption, weak industrial production and easing inflation, with HICP at 2.4% in March. It highlights wage pressures from a 16% minimum wage increase, external risks from weaker foreign demand and Chinese competition, and inflation expectations linked to the Middle East war. It notes a wider 2025 general government deficit of 2.5% of GDP, lower debt at 65.7% of GDP, and urges temporary, targeted energy support to safeguard fiscal sustainability.