The Croatian Central Bank (HNB) Governor Boris Vujcic said on Wednesday that the HNB forecast of Croatia's inflation rate in 2024 would be revised from 4% to 3.5%, and the wages would rise at a smaller rate in real terms this year compared to 2023.

Currently, the inflation rate is waning at a higher rate than what we already forecast, Vujcic told in Split where Mediterranean central banks held a conference.

The governor called for caution in interpretations of the wage growth.

A large part of the increase in wages happened in 2023, so we will have a lower rate of wage rise in 2024 than in 2023. The wage growth will be positive this year, but lower in the real terms compared to 2023, Vujcic said.

In 2023,  monthly pay rose 5.7%, and in 2024, this rise is expected to be around 3.6%, which should not impact the inflation rate.

Croatia’s economy is set to expand by 3% in 2024, and, the growth can be higher, he said.

However, the headwind to the growth can be developments in the economies of trading partners such as Germany, according to Vujcic.