Banks in Europe

Capital city: Vilnius

Population: 3.4 million

Currency: litas (LTL)

Languages: Lithuanian (official) 82%, Russian 8%, Polish 5.6%, other and unspecified 4.4%

Dialling code for int. phone calls: +370

Internet country code: .lt

The only Baltic country still showing respectful growth, Lithuania, is set for a further slowdown. The imbalances are very similar to those previously felt by Estonia and Latvia: wide current account deficits, strong dependency on capital inflows and a weakening real estate market, although Lithuania had a less overheated economy compared to the other two and can benefit from a slightly more diversified economic structure (with a higher share of industry and agriculture).

However, given its slightly delayed economic cycle a slowdown is expected. The corporate sector is already showing signs of weakening. Weaker demand will, however, improve the current account deficit and dampen inflationary pressures. The latter seem to have peaked during the summer. Parliamentary elections will be held on 12 October; the outcome is far from guaranteed, but the political environment is not a major source of risk for the country.

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