Bulgaria’s economy posted 1.1 per cent growth in the first quarter of 2019, the National Statistical Institute (NSI) said in a flash estimate on May 15. In real terms, gross domestic product (GDP) in Bulgaria in the first three months of the year was BGN 23.88 billion, or EUR 12.21 billion. In annual terms, economic growth in the first quarter was 3.4 per cent. NSI is due to announce preliminary growth figures for the quarter on June 6. The flash estimate’s seasonally-adjusted data showed domestic consumption grow by 0.3 per cent during the first quarter (and was 3.5 per cent higher on an annual basis), while gross fixed capital formation rose by 0.2 (which was also up by 2.6 per cent compared to the first quarter of 2018). Exports rose by 1.8 per cent during the first quarter (and were five per cent higher compared to the same period of 2018), while imports declined by 0.6 per cent compared to the previous quarter (but were 1.7 per cent higher on an annual basis). The country recorded a small trade surplus of BGN 21.4 million the first quarter, NSI said.

Inflation in April compared to March reached 0.5 per cent, the National Statistical Institute said Wednesday. Inflation from the beginning of the year (April 2019 compared to December 2018) was 1.7 per cent, and the annual inflation for April 2019 as compared to April 2018 was 3.7 per cent. Food prices were one per cent higher compared to March and non-food prices rose by 0.9 per cent, while services prices were down 0.4 per cent. Compared to April 2018, food prices were 5.6 per cent higher, while non-food and services prices rose by 1.9 per cent and 3.6 per cent, respectively. The average annual inflation for the period May 2018 - April 2019 compared to the period May 2017 - April 2018 was 3.3 per cent.

Gestamp North Europe Services intends to invest BGN 23.5 million in the acquisition of major stakes in Belgium peer Viohalco's aluminium profiles production and processing businesses in Bulgaria. Gestamp North Europe Services, part of Spanish metal automotive components group Gestamp, plans to acquire shareholding interest in Viohalco's indirectly owned units Etem Automotive Bulgaria and Etem Aluminium Extrusions by increasing the two companies' capital. Etem Automotive Bulgaria and Etem Aluminium Extrusions were spun off by Etem Bulgaria - a wholly-owned subsidiary of Viohalco, last month. They are active in extruded aluminium profiles production and automotive aluminium profiles processing businesses, respectively. Etem Aluminium Extrusions' capital will be increased by BGN 18.58 million to BGN 37.92 million, while Etem Automotive Bulgaria's capital will be hiked by BGN 4.89 million to BGN 9.59 million. Following the capital increase, Spain-based Gestamp North Europe Services will control a 49% stake in Etem Aluminium Extrusions and a 51% stake in Etem Automotive Bulgaria, according to SeeNews estimates.

The German automotive and engineering company VOSS Automotive starts producing auto parts in Lovech. The mass production of components for the automotive industry will begin in May, as the company announced earlier this year. The first orders are already received by three of the largest automotive manufacturers. In April, the manufacturer installed the first auto parts machines in its new plant, located in Bahovitsa Industrial Park, Lovech, after which the Bulgarian team of specialists carried out their first production. Previously, employees completed 3 months of study in Poland. In the future, the production will be made by two Bulgarian teams which have passed VOSS Automotive's professional training. The German group plans to open 1000 new jobs for the people in Lovech and Pleven regions, while providing intensive training and opportunities for long-term growth and development of its employees.

The Electricity System Operator (ESO) has started the construction of a 400 kV internal power line between Maritza East and Burgas. The power line is one of the five projects of common European interest that ESO implements under Regulation 347/2013 for the development of trans-European energy infrastructure. The 150 km pipeline connects the substation Maritza East with substation Burgas. It is part of Bulgaria's internal 400-kilovolter transmission network. The airline is part of a Group of Projects ‘Bulgaria – Greece’, which are of common interest under Regulation 347/2013. The project is of key importance for the realization of the North-South priority energy corridor and for the construction of the trans-European energy infrastructure. The power line is of general importance for Bulgaria and improves the safety of the transmission system. For the realization of the investments, funding from the European Connecting Europe Facility was raised to the amount of BGN 60 million for the construction of the new 400 kV internal power line between the substation Maritza East and the substation Burgas.

M-Group Corporation LTD sold its entire stake of 54.4959% in the capital of Bravo Property Fund REIT on May 10, 2019, shows the weekly bulletin of the Central Depository AD. The buyers are Asen Stoimenov Lisiev, whose participation increased from 15.0133% to 42.261%, also Black Sea Development LTD with an increase from 0% to 21.798%, as well as Pavel Tomasz Sudzarsky-Kshonzek with an increase from 0% to 5.4496%. M-Group Corporation LTD recorded 20,000,008 shares each with a nominal value of BGN 1 at the recent capital increase of BGN 36.05 million. The capital increase was attended by 52 persons. Over BGN 1 million participation was recored for Doverie UPF with BGN 2,352 million, Saglasie UPF with BGN 1.12 million, M-Group Corporation LTD with BGN 20 million, Megasence Property JSC with BGN 1 million, Karoll Finance LTD with BGN 1 million and Asen Lisiev with BGN 5.04 million.

Raiffeisen Bank International (RBI) said that its profit after tax from operations in Bulgaria rose to EUR 12 million in the first quarter of 2019 from EUR 9 million in the same period of 2018. The lender's operating income in Bulgaria increased to EUR 44 million in the January-March period of 2019 from EUR 38 million in the comparable period of 2018. Net interest income edged up to EUR 26 million in the review period from EUR 25 million a year earlier, while net fee and commission income grew to EUR 13 million from EUR 11 million. General administrative expenses rose slightly, to EUR 25 million in the first three months of 2019 from EUR 24 million in the prior-year period. RBI's assets in the country increased to EUR 4.17 billion at the end of March from EUR 3.76 billion a year earlier. Loans to customers rose to EUR 2.72 billion from EUR 2.34 billion, while deposits grew to EUR 3.22 billion from EUR 2.77 billion. The lender's NPE ratio in Bulgaria improved to 2.0% from 3.0% the year before. RBI operated 146 business outlets in Bulgaria at the end of March, same as a year earlier. The group employed 2,606 employees at the end of March, 5 more compared to a year earlier.

Germany’s economy emerged from stagnation at the beginning of 2019, returning to growth despite a slump in manufacturing that could worsen because of escalating global trade tensions. The 0.4% expansion signals some strength across the euro area in the first quarter amid a better-than-expected performance in a number of countries. But industry is under pressure and the region is at risk of being sucked into an increasingly tense U.S.-China trade conflict. Global worries were heightened on Wednesday, with reports showing the Chinese economy continues to cool despite efforts by the government and the central bank. Figures pointed to slower growth in industrial output, retail sales and investment at the start of this quarter. Germany’s first-quarter pickup matched the median forecast of economists. The statistics office said there was a boost from consumer spending, construction and equipment investment, while there were “mixed signals” on trade. In the euro area, growth was also 0.4% in the period, twice the pace of the previous three months.

U.S. retail sales unexpectedly declined in April for the second time in three months, weighed down by soft sales of autos and building materials and suggesting consumer spending will remain subdued this quarter. The value of overall sales declined 0.2% after a 1.7% increase the prior month that was the strongest gain since 2017, according to Commerce Department figures released Wednesday. That compared with the median forecast in Bloomberg’s survey calling for a 0.2% rise. Sales in the “control group” subset, which some analysts view as a cleaner gauge of underlying consumer demand, were unchanged from the prior month, below projections for a 0.3% gain. The measure excludes food services, car dealers, building-materials stores and gasoline stations. The figures, also reflecting weakness in the category that includes online sales, suggest spending remains soft following the weakest quarterly increase in a year. That could bolster pressure from President Donald Trump and financial markets to cut borrowing costs amid unexpectedly low inflation, though Federal Reserve policy makers have pledged patience as steady job and income gains should support purchases in coming months. 

The world’s biggest automaker Volkswagen AG said it’s building two plants in China to produce a total of 600,000 vehicles on its dedicated battery-car platform, dubbed MEB. The new factories in Anting and Foshan will open a few months after Germany’s Zwickau, which will assemble as many as 330,000 cars annually and is slated to get started by year-end. Following through with plans to reach this level of scale will likely leave Tesla trailing behind. Its lone vehicle assembly plant operating in Fremont, California, can make about 500,000 cars. The electric-car leader expects to start output on the outskirts of Shanghai at the end of this year and produce 250,000 vehicles a year initially. For More: VW Boosts EV Push to 22 Million Cars as Costs Squeeze Margins VW has little time to lose after Tesla resolved manufacturing snafus in Fremont and its battery factory near Reno, Nevada, which may start also building Model Y crossovers. While Model 3 sedan deliveries tailed off in the first quarter following a strong second half of 2018, Chief Executive Officer Elon Musk has dismissed concerns about demand and stuck to a forecast for as many as 400,000 vehicle deliveries this year.