The March 2018 issue of the Monthly Report on Bulgarian Economy was released. It assesses the short-term dynamics of main economic indicators. The publication is prepared by the Economic and Financial Policy Department at the Ministry of Finance.

The economic climate tracer in the country moved deeper in the expansion area over the first quarter of 2018, suggesting acceleration of the economic growth. 

Short-term business statistics reported weaker performance in February as growth of industrial production, construction output and retail trade slowed down. The business climate indicator increased in March due to better assessments in construction and retail trade, while the consumer confidence indicator decreased due to some worsening of the expectations regarding the general economic situation in the country. 

In March, the registered unemployment further decreased to reach 6.8% due to the higher outflow of unemployment.

Consumer prices fell by 0.2% mom on average in March. Meanwhile, the annual inflation rate accelerated further to 1.9% yoy. The rate of increase in services prices gained further momentum, thus core inflation stepped up to 1.9% yoy.

In January, the overall current account balance came in negative at 0.3% of GDP. The export of goods increased by 18.4% yoy, while import rose by 23.9%, which led to a slight deterioration in the trade balance to a deficit of 0.5% of GDP. Gross external debt stood at 61.9% of GDP, declining both on a month and a year earlier.

The annual growth rate of credit to the private sector slightly accelerated to 5% yoy in February vs 4.8% a month earlier, mainly on the account of households’ credit. 

Weighted average interest rate on new time deposits increased by 4 bps, largely due to the higher price for attracted funds from non-financial corporations. Meanwhile, weighted-average interest rate on new credits to non-financial corporations and consumer loans decreased, down by 38 bps and 26 bps, respectively, while the price of mortgages posted a slight increase, up by 6 bps. 

According to monthly data on a cash basis, the budget balance on the consolidated fiscal programme (CFP) for the first two months of 2018 was positive, amounting to BGN 0.8 bn (0.7% of projected GDP). The surplus resulted from higher revenues over expenditure on the national budget (0.9% of GDP), while the EU funds account recorded a minor deficit (0.2% of GDP).

The entire document can be downloaded here.