Q: What is the outlook for the Lithuanian economy? Do you expect a worsening of economic conditions?
A: Like other EU economies, Lithuania is suffering the negative consequences of Russia’s war against Ukraine. We expect our economy to slow down in the second half of the 2022, despite the rather good first half of the year. The baseline scenario for both this year and next is that our economy will continue on the growth path, expanding by around 1.5% in both 2022 and 2023. Of course, uncertainty is very high and the risk balance is tilted to the downside. The energy price shock is the main issue — it hurts business competitiveness and erodes people’s purchasing power by having a substantial impact on inflation levels.
