27.11.2014

The Ministry of Finance updated the autumn macroeconomic forecast. The revision is predetermined by a number of internal and external changes in the economic environment. The assessment of the development of the EU economy in the autumn forecast of the European Commission from November this year is more pessimistic than in the spring forecast of the Commission. The Commission experts expect the rates of economic growth in the Euro area to slow down at the end of 2014 and at the beginning of 2015 and the economic activity to gradually improve after that.

The considerable drop in the world prices of crude oil in the past months has led to a change in the assumptions on the price of the raw material which also changed the forecast for the consumer prices of fuels and the development of the inflation processes in the country. The negative change in the expectations for the dynamics of the world and EU economies, together with the continuing drop in world prices also influenced the forecast for Bulgaria's foreign trade. The real growth of the exports of goods and services has decreased which leads to lower exports' contribution to GDP growth in 2015.

The worsened expectations of entrepreneurs for the investment activity in the industry as well as of consumers for the development of the economic situation in the country conduced to adjusting the forecast towards a weaker increase of domestic demand. The expectations for a slow-down of investment activity and consumption in the country, together with the weaker demand for resources by export-oriented branches are reflected in decreasing the imports' growth next year.

The update of the macroeconomic forecast of the Ministry of Finance is also based on an assessment of the effect from non-reimbursement of part of the unguaranteed deposits in CCB on the economic growth. The document was used in drafting the medium-term budget forecast for the period 2015-2017.