Ernst & Young downgrades forecast to 1.5 percent

29.06.2012, 11:38

Auditor Ernst & Young is calling for 1.5 percent economic growth this year, less than the 2 percent it projected a quarter ago.

That mark is the lowest of the major estimates on record, as the finance ministry says 1.7 percent and the Bank of Estonia has weighed in with 2.6 percent.

The average forecast for the nation's economy from commercial banks is around 2 percent growth.

Further, Ernst & Young's analysts see growth as topping out at under 5 percent until 2016.

"That is provided that the Eurozone survives and no major crises or exits take place," said Ernst & Young Baltic board member Ivar Kiigemägi.

According to Ernst & Young, inflation will remain high, at 3.8 percent, and unemployment will be 11.4 percent in 2012, to drop to 5.7 percent by 2016.