The Central Bank of Cyprus revised its forecast of the country's economic growth for 2018 year from 3,4% to 4,1%. This is stated in the message of the supervisory authority from 2 July.
In the next two years, the Central Bank believes, GDP growth will continue: the forecast indicator for 2019 is 3,9%, and for 2020, 3,5%. The main driver of economic growth will be private consumption.
"In 2018, private consumption growth is expected to be at the level of 2,5%, after it grew by 2017% in 4,2. This reflects the increase in cash income mainly due to the growth of employment and, to a lesser extent, the growth of the level of wages, "the Central Bank said in a statement.
The growth of incomes will positively affect the volumes of not only private consumption, but also the savings of households, which in the years of the crisis were forced to spend deferred money. Another positive consequence is the resumption of consumer servicing of loans.
According to the forecasts of the Central Bank, the unemployment rate this year will decrease to 9,1% compared to 11% last year. In 2019, the unemployed will be 7,4% of the able-bodied population.