The projection of economic activity growth in BiH this year has been revised downwards, to the level of two percent, due to the weakening of domestic and external demand, which was reflected in personal consumption, investments, imports and exports, the Central Bank of BiH announced.
In the Autumn Round of Medium-Term Macroeconomic Projections, the CBBH states that these components of the national accounts are also partially influenced by the base effect from last year. The most significant contribution to economic growth in the short term is still expected from personal consumption, as the largest macroeconomic aggregate.
“By the end of the projection horizon, we currently expect a gradual intensification of economic activity and a gradual weakening of inflationary pressures,” the CBBH points out.
They note that due to the lack of official data on GDP according to the expenditure calculation for the second quarter of the current year, the latest rapid estimate of real GDP growth for the second quarter (1.9 percent) was used.
A detailed revision of official GDP statistics according to the consumption approach is underway, and revisions of projections in the spring 2026 round are also possible on this basis, the CBBH added.
“Domestic inflationary pressures have significantly increased since the beginning of the year. In 2025, we project inflation of 4.1 percent, which has been revised upwards by 0.6 percentage points compared to the spring round of medium-term macroeconomic projections, and is consistent with the latest flash estimates of inflation in the short term. A gradual weakening of domestic inflationary pressures is expected over the projection horizon,” the CBBH stated.
The estimated values of real GDP, its components and other macroeconomic variables, as they added, are exposed to an extremely high degree of uncertainty related to economic activity in major trading partner countries, political conditions at the global and local levels, but also the possible significant effects of changes in the domestic labor market on the price competitiveness of domestic products and services.
