The decline in liquidity due to the further repayment of TLTRO funds and the shrinking of the APP portfolio will further strengthen transmission via the banking channel in the coming months. Furthermore, any deterioration in the macroeconomic environment would also reinforce the banking channel by reducing loan demand and increasing credit risks.
Economic growth will be dampened by a weak global economic activity and decrease in gas transit to European countries starting in 2020, due to the construction of bypassing gas pipelines. The 2019–2021 current account deficit will remain acceptable.