Weak Demand Recovery Ahead

We hold to our view that Slovenia will experience a very weak recovery in domestic demand in 2010, with private consumption and gross fixed capital formation forecast to expand by 1.0% and 2.0% respectively. That said, statistical base effects and a further improvement in the country's net trade position should lift headline real GDP growth back to 2.0%. Over the long run, we stand by our forecast for trend growth to come in between 3.0-3.5%, well below the pre-recession average.

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