Real GDP growth moderated to +4.4% y/y in Q3 from +4.9% in Q2, taking the average expansion in the first three quarters of this year to +4.6% y/y. The expansion in Q3 was mainly driven by consumer spending (up +7% y/y, after +7.8% in Q2) on the back of modest price growth. Headline inflation was 1.1% y/y in October, unchanged from September’s four-month low. Meanwhile, government spending increased by a moderate +1% y/y in Q3 (after +0.3% in Q2) while the decline in fixed investment accelerated to -3.7% (after -0.6% in Q2). At the same time, external trade activity weakened further in Q3 as a result of ongoing global trade tensions. Yet, net exports made a positive contribution to Q3 growth as real imports decreased at a faster rate (-3.3% y/y, after -2.1% in Q2) than real exports (-1.4%, after +0.1% in Q2). The Q3 data are broadly in line with our expectations and we expect a further slowdown in Q4. Hence we maintain our full-year GDP growth forecast of +4.3% in 2019 for the time being.
