The Institute for Economic Research and Policy Consulting (IER) reports a contraction in real gross domestic product (GDP) for the third consecutive month, with March 2026 showing a decline of 0.3% compared to the same period last year.
According to the Monthly Economic Monitoring (MEMU) published on the institute’s website, the IER also updated its estimate of the economic decline for February. In the previous MEMU release, the drop in real GDP was estimated at 1.6%, but after revision it was adjusted to 0.5%. As a result, for the first quarter, the institute estimates a 0.6% decline in real GDP.
The IER estimates that real gross value added (GVA) in the extractive industry fell by about 2% in March compared to March 2025, due to disruptions in gas and iron ore extraction. Electricity generation and gas distribution decreased by 15% year-on-year, although part of the generation capacity was repaired, and renewable energy sources also contributed to output. In March, there were a relatively high number of sunny days, supporting solar generation. Electricity imports in March fell by 25% compared to February, to 942,000 MWh, while exports amounted to 30,000 MWh.
Real GVA in the manufacturing industry decreased by 0.7% compared to March 2025. Real GVA growth in trade remained at around 2%, although the institute expects that wholesale trade may have declined.
In transport, real GVA fell by about 10% compared to March 2025 due to higher fuel costs, reduced volumes of iron ore and oil transportation, and ongoing Russian attacks.
As for inflation, it accelerated in March to 7.9%, up from 7.6% in February and 7.4% in January, after seven months of slowdown.
“This reflected higher oil and petroleum product prices due to the war in the Middle East and high electricity prices for businesses. Relatively strong competition for limited demand in non-food goods so far restrained price growth,” the IER explained.
