Economic growth picks up in the third quarter of 2025

Economy posts the strongest expansion in a year: Slovenia's GDP increased 1.7% on a year-on-year basis in Q3, following an upwardly revised 0.8% expansion in the prior quarter. This marked the strongest result in a year, and was in line with our Consensus Forecast. On a seasonally adjusted quarter-on-quarter basis, the economy expanded 0.8% in Q3, following an upwardly revised 0.9% increase in the previous quarter.

Fixed investment and government spending rebound: Compared to the prior quarter's data, readings in Q3 improved for government consumption (+1.2% in annual terms vs -0.7% in Q2), fixed investment (+9.1% vs -0.1% in Q2) and imports of goods and services (+0.7% vs -0.9% in Q2). In contrast, readings softened for private consumption (+1.0% vs +2.2% in Q2) and exports of goods and services (-1.1% vs +0.3% in Q2). The sharp rebound in fixed investment was due to increased spending on buildings and other structures, which was likely bolstered by EU fund inflows and the ECB’s monetary policy easing cycle. On the external front, exports were likely hampered by U.S. tariffs and the economic stagnation of top trading partners Italy and Germany.

GDP growth to accelerate: Our Consensus is for GDP growth to accelerate further in Q4 as past interest rate cuts boost fixed investment, and as lower inflation supports private spending growth. In 2026, these same two drivers should help push up economic growth further to a three-year high. A key factor to watch is the health of the German economy following its recent stimulus package.

Panelist insight: Commenting on the outlook, Alen Kovac, analyst at Erste Bank stated: “As far as the outlook goes, domestic demand is expected to remain the key growth engine, with private consumption maintaining steady growth momentum on the back of resilient labor market conditions and steady confidence indicators. [The] investment profile is expected to further extend [an] improved footprint, supported by the absorption of EU funds. On the other hand, challenges regarding the external demand developments should continue to weigh on the export outlook, thus diminishing net exports’ contribution in period ahead.”

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Slovenian private consumption projections for the next ten years from a panel of 13 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable private consumption forecast available for Slovenian private consumption.

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