Analytics, Economics, GDP, Latvia

Swedbank senior economist Dainis Stikuts said that GDP growth pace should have decreased in the fourth quarter last year, compared to the third quarter of 2011, nevertheless, the growth was positive, writes LETA.

"Consumer and business mood remained stable, budget tax revenue were also increasing. Private consumption was rather cautious, as attested by a 0.8% reduction in retail trade turnover from the previous quarter (seasonal factor excluding), industrial production output also decreased 0.9% because of a reduction in heat production as the beginning of the winter was warm. Nevertheless, processing industry recorded a 1.9% growth, supporting exports," said Stikuts.

If the annual GDP growth in the fourth quarter last year was 5.9%, then the GDP increase for the entire last year was 5.4%, said Stikuts.

"The recovery was mostly thanks to rapid growth in exports (processing industry, tourism, transport and warehousing), as a result, investments and household consumption increased. Private consumption was backed by growing optimism, employment and wages. The overall structure of the economy is now better balanced, as it moves from domestic consumption toward exports," stressed Stikuts.

SEB banka economist Dainis Gaspuitis also said that positive economic trends persisted in the fourth quarter last year, nevertheless, the growth in the fourth quarter of 2011 should have been smaller than in the third quarter. Gaspuitis believes that GDP growth in the fourth quarter and in the entire 2011 was 5.4%.