South-Eastern Europe Economic Outlook
South-Eastern Europe is forecast to expand at a similar pace to 2025 in 2026, thus remaining slower than the past-decade average. Reduced borrowing costs, robust travel demand, subdued fuel prices and a recovery in Germany—an important trade partner—should bolster growth, even as U.S. tariffs weigh. Additional U.S. tariff increases pose a downside risk.
South-Eastern Europe Inflation
Turkey has posted by far the region’s highest inflation this year, with price growth above 30%, followed by Romania. Inflation across the rest of South-Eastern Europe has been much milder, generally ranging between 1% and 5%. This three-tier inflation profile—very high in Turkey, moderately elevated in Romania and contained elsewhere—is likely to persist into 2026.
This chart displays Economic Growth (Real GDP, ann. var. %) for South-Eastern Europe from 2010 to 2025.
| 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|
| 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 |
| 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 |
| Industrial Production (ann. var. %) | -1.6 | 13.0 | 3.6 | 0.5 | 0.3 |
| 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 |
| Private Consumption (annual variation in %) | -0.3 | 11.3 | 13.1 | 3.4 | 4.4 |
| Economic Growth (Real GDP, ann. var. %) | -1.7 | 9.8 | 5.2 | 3.9 | 2.9 |