According to the latest Economic Outlook, the largest Nordic and Baltic financial group writes that Lithuania’s GDP should contract by 2.4 pct this year before expanding by 3 pct in 2011.  Latvia’s GDP should contract by 2.9 pct in 2009 and grow by 2.7 pct in 2011, Estonia’s accordingly decline by 0.5 pct and grow by 4 pct in 2011.

However, Nordea’s predictions has improved since last November when the bank projected the contraction of 3 pct for Lithuania, of 3.5 pct for Latvia and of 1.5 pct for Estonia. Then the banks estimated that in 2011 Lithuania’s economy should expand by 2.2 pct, Latvia’s – by 2 pct and Estonia’s – by 2.8 pct.

According to the latest Economic Outlook, last year Lithuania’s economy, as estimated by Nordea, contracted by 16 pct, Latvia’s and Estonia’s – by 18 pct and 15 pct, respectively.

The report predicts that the average annual inflation in Lithuania should be minus 1 pct in 2010 and 1 pct in 2011, for Latvia – minus 3 pct in 2010 and minus 0.5 pct in 2011, for Estonia – minus 1 pct in 2010 and 1.5 pct in 2011.

As projected by the bank, Lithuania’s fiscal deficit will reach 8.5 pct of GDP this year before going down to 7.8 pct in 2011. Latvia’s fiscal deficit will reach 8.2 pct this year and 6 percent next year, Estonia’s – 3 pct and 2.8 pct, respectively.