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Central bank sees slower growth for Lithuanian economy
Last Updated: 2018-12-20 09:41 | Xinhua
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The Bank of Lithuania has revised down on Wednesday the country's economic growth forecast for 2018 and sees slower growth next year.

The Central Bank has cut economic growth forecast for 2018 from 3.4 percent to 3.2 percent. The GDP growth forecast for the next year remains unchanged at 2.8 percent.

This year's economic forecast was revised after taking into account "global and domestic economic trends", according to the Bank of Lithuania.

"Growth in exports and investments is to slow down due to global trade trends," Gediminas Simkus, head of the Economics and Financial Stability department at the Bank of Lithuania, said in a statement.

According to the Central Bank's economists, domestic consumption in Lithuania, driven by rising wages in private as well as public sector will remain "an important engine of economic growth" in Lithuania.

The latest forecast from the Bank of Lithuania shows wage growth is to reach 9.5 percent this year, before moderating to 6.9 percent next year.

In recent years, rapid wage growth was caused by lack of labor force and emigration which forced local companies to increase pay, the country's economists explain.

Increase in wages has also prompted inflation, especially in services' sector, said the Bank of Lithuania.

The Bank has also revised up inflation forecast for next year from 2.2 percent to 2.4 percent. This year's inflation forecast remains unchanged at 2.6 percent.

Unemployment in Lithuania is expected to account to 6.3 percent, before dropping to 6.1 percent next year, according to the Bank of Lithuania.

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