Denmark: Growth is still elusive
APRIL 12, 2013
Fourth quarter GDP, released after the February issue of
dropped 0.7%.The main negative contribution was exports on the back of lower global growth. As in thethird quarter, corporate investments were a counterbalancing factor. Public expenditurerose markedly and spending is catching up with budgets.
Private consumption has been flat for a year as real wages and employment have fallen.Consumer confidence points to a continued subdued trend, but a large decline ininflation has recently turned real wage growth positive, thus improving the outlook.
The current account surplus has dropped in recent months compared to most of 2012.This is partly related to slower global growth, but also reflects a seasonal pattern intransfers that will impact March numbers as well. The underlying positive trend is intact.
Due to weakness late in 2012, we have revised our 2013 growth forecast downward to0.3% from the previous 0.7%. We expect a gradual recovery to 1.7% in 2014 due to aglobal recovery. Our inflation forecast for 2013 has been revised downward from 1.5% to1.1%.
Jakob Lage HansenX-asset Research+45 33281469
2011 2012 2013 2014
GDP* 1.0 -0.5 0.3 1.7Unemployment
4.1 4.7 5.1 4.9Inflation* 2.7 2.4 1.1 1.3Government deficit** -1.8 -4.0 -2.0 -1.0
* Percentage change, ** Per cent of labour force, *** Per cent of GDPSource: SEB