Latvia’s GDP will grow by 1.7% in 2025, according to the Bank of Latvia’s revised macroeconomic forecast, LSM reports. In June 2025, the central bank projected 1.2% GDP growth in 2025. The new forecast expects economic growth to accelerate thanks to increased domestic and external demand. The GDP will grow by 2.8% in 2026, by 2.9% in 2027, and by 3.2% in 2028. Annual inflation will reach 3.9% in 2025, which is up from an earlier forecast of 3.4%. Inflation will amount to 3.2% in 2026, to 2.9% in 2027, and to 3.6% in 2028, the Bank of Latvia projects. Wages will rise by 8.0% in 2025, by 7.6% in 2026 and 2027, and by 7.9% in 2028. Unemployment will reach 6.9% in 2025 and then drop to 6.6% in 2026, to 6.4% in 2027, and to 6.2% in 2028. The government’s budget deficit will amount to 2.7% of GDP in 2025, to 3.5% in 2026 and 2027, and to 3.1% in 2028. General government debt will be 48.4% of GDP in 2025, rising to 49.4% in 2026 and to 50.8% in 2027 and 2028, according to the forecast.
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