Moderate growth in 2017-2019
Real GDP growth decelerated from +3.2% in full-year 2016 to +2.8% y/y in Q1 and +1.7% y/y in Q2 2016. In the first half of 2017, robust growth was recorded in manufacturing (+3.7% y/y), financial services (+3.9% y/y), trade, transportation, accommo¬dation and food services (+4.9 % y/y) and other private-sector services (+4.6% y/y) while construction (-1.5% y/y) and business-related services (-3.2% y/y) contracted. EH forecasts full-year growth of about +2.4% in 2017, followed by similar rates in 2017 and 2018. Consumer price inflation has returned to moderate positive territory in 2017, and we expect an annual average of +1.2% in 2017, followed by slightly above +2% in 2018-2019.