In the first quarter of 2024, the country’s real GDP growth is expected to accelerate, which is a prerequisite for similar annual dynamics, the Bulgarian National Bank said in its regular economic review.

The GDP growth is mainly due to the data on the improvement of consumer confidence, the positioning of the global Purchasing Managers' Index (PMI) above the neutral threshold of 50 points, the increase in the indices of production in construction, retail trade and services in real terms, as well as the increase in loans to households and firms.

In the second and third quarter of 2024, real GDP is expected to continue growing, primarily supported by domestic demand and improved prospects for external demand for Bulgarian goods and services.

The BNB forecasts a continued slowdown in annual inflation, but strong consumer demand and rising labour costs will continue to exert inflationary pressures.