This slight growth in Q3 2025 indicate a slight improvement in the economy compared with both a year ago and the previous quarter, according to Robert Müürsepp, team lead of national accounts at Statistics Estonia.

"The seasonally and working-day adjusted GDP was up by 0.2 percent" from the second quarter of 2025," Müürsepp noted.

Statistics Estonia's GDP flash estimate is prepared using statistical models, so is not methodologically comparable with the official GDP, which takes into account all economic transactions.

Experts: Modest growth seen and future may be a little rosier, but caution needed

Commenting on the Statistics Estonia results, chief economist at Luminor Pank Lenno Uusküla said a continued modest growth was to be expected, noting that manufacturing in Q3 2025 has continued to show slight growth. Export figures for goods of Estonian origin have remained stable, too.

"In retail trade, which does not include car sales — since those are mainly imports — a small growth has persisted, contributing to the expansion of domestic demand. There were also slightly more tourists this summer than last. The real estate sector has shown increased activity, and home loan uptake grew noticeably in summer, showing that people are once again ready to make longer-term decisions. Money market interest rates have come down, and as inflation in the euro area continues to decline, interest rates are staying roughly stable," Uusküla set out.

According to the economist, the outlook for the final quarter of the year is somewhat more optimistic.

"As the price rises caused by tax hikes have mostly passed, inflation should remain lower than wage growth in the near term. This will support the growth of private consumption," he went on.

"Alongside this year's one-percent growth expectation, the economy could grow by two percent next year. Although the end of the downturn and the return to growth are significant milestones, we are still far below our potential level," Uusküla added.

Chief economist at Bigbank Raul Eamets nevertheless urged caution, noting that the estimate is mainly based on model calculations which might later be significantly revised. The final GDP result may also be influenced by a select large transactions that have not yet been reflected in the statistics.

"Quarterly results give some indication of the direction the economy is headed, but they should not be over-stated. Last year, the statistical discrepancy arising from combining different GDP calculation methods was 0.7 percent of GDP. That can be called a rounding-up error of sorts," Eamets explained.

Nonetheless, Eamets said, there were signs of the green shoots of recovery. "On the other hand, the quarterly result shows the overall trend — the quiet recovery of the economy from the crisis."

Economic analyst at SEB Pank Mihkel Nestor meanwhile said he is somewhat more optimistic. This time around, the estimate aligns fairly well with other economic indicators, he said. "Almost all key economic indicators, including industrial output and retail sales, demonstrated modest growth. The data confirm that the economy is back on a growth path, but that growth is slow," Nestor said.

According to the SEB analyst, more significant economic recovery can be expected in 2026. SEB's forecast projects next year's GDP growth at 2.5 percent. However, that growth will continue to be hampered by the weak state of Finland's economy — Estonia's main trading partner — and this will affect local exporters' opportunities.

Swedbank's chief economist Tõnu Mertsina meanwhile noted that the fresh flash estimate matched the bank's expectations. "Although according to these preliminary figures the economy grew by only 0.4 percent in the first nine months of the year, growth is improving, and the second half of the year should be somewhat stronger than the first," Mertsina said.

"The overall confidence of Estonian companies and households is better than it was a year ago, though there has been no significant further improvement this year. Confidence also remains well below the long-term average," the Swedbank chief economist went on.

Statistics Estonia says official third-quarter GDP data will be released on December 1, but current information allows for an assessment of the economic trend. This is done using trade indicators, transport and manufacturing stats, tax filings, energy data, and prices, which feed into models of the Estonian economy. This process, known as econometric modeling, links economic trends and seasonality with indicators to describe the economy's state.

The flash estimate assumes stable economic trends and structures. However, the initial data may not include major transactions that could significantly impact the overall indicators, given Estonia's small economy.

More detailed information is available from Statistics Estonia here and here.

Editor's note: This piece was updated to include comment from Luminor, SEB, Swedbank and Bigbank economists.

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