Estonia’s GDP growth will reach 2.4% in 2026 and remain close to 2.5% in 2027 and 2028, according to the Bank of Estonia’s latest forecast, ERR reports. In March 2026, the central bank had projected annual GDP growth of around 2.8%. Strong fiscal stimulus will boost economic growth in 2026, with increased household and public sector spending, the Bank of Estonia estimates. Also, the elimination of the so‑called “tax wedge,” which has reduced the personal income tax burden, will lead to a rapid rise in the average real net monthly wage, the central bank notes. Meanwhile, annual inflation will amount to 3.4% in 2026 and remain close to 2.5% in 2027 and 2028, according to the Bank of Estonia’s baseline scenario.
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