South-Eastern Europe Economic Outlook
Economic growth in SEE is projected to expand at roughly the same pace in 2026 as in 2025, remaining under the decade-long average. Cheaper borrowing costs, robust tourism demand and Germany’s recovery—the country is a major trading partner—should bolster activity despite pressures from U.S. tariffs. Additional U.S. tariff increases pose a downside risk.
South-Eastern Europe Inflation
Turkey posted by far the highest inflation in the region in 2025, averaging 35%. Romania registered the second-highest inflation rate of 7.3%. In the rest of South-Eastern Europe, rates ranged between 1% and 5%. This three-tier inflation profile—extremely high in Turkey, elevated in Romania and contained elsewhere—continued in January and should persist later in 2026.
This chart displays Economic Growth (Real GDP, ann. var. %) for South-Eastern Europe from 2010 to 2025.
| 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|
| Private Consumption (annual variation in %) | -0.1 | 11.4 | 11.7 | 6.8 | 4.4 |
| Policy Interest Rate (%, eop) | 9.11 | 7.53 | 6.74 | 25.93 | 29.30 |
| Inflation (CPI, ann. var. %, aop) | 6.6 | 11.4 | 43.5 | 32.7 | 34.5 |
| Industrial Production (ann. var. %) | -1.6 | 10.9 | 3.7 | 0.5 | 0.3 |
| Unemployment (% of active population, aop) | 11.8 | 10.8 | 9.5 | 8.6 | 8.0 |
| Public Debt (% of GDP) | 66.2 | 64.4 | 54.5 | 50.4 | 45.8 |
| Investment (annual variation in %) | 3.4 | 7.8 | 6.5 | 8.9 | 2.3 |
| Fiscal Balance (% of GDP) | -5.8 | -4.2 | -2.2 | -4.2 | -4.3 |
| Economic Growth (Real GDP, ann. var. %) | -1.7 | 9.8 | 5.2 | 3.9 | 2.9 |