About Danmarks Nationalbank

The IMF's analyses of the Danish economy


Abstract icon Following its recent Article IV mission in Denmark, the International Monetary Fund, IMF, concludes that Denmark has achieved an impressive post-pandemic recovery, with the output and employment level now well above its pre-pandemic trajectory, contributing to inflationary pressures. More recently, there are signs that economic activity has started slowing, and high inflation, tightening financial conditions, and weaker external demand will weigh on the outlook. The financial system has remained stable, although house prices have fallen. The medium-term growth outlook remains modest, reflecting well-known demographic headwinds in Denmark and lower global growth.
Every year, a team of IMF economists visits Denmark to analyse the Danish economy. Half a year in advance, the IMF makes preparatory visits, known as interim visits. This is part of the IMF's surveillance of its member countries' economic development. During the visit, the IMF meets with relevant ministries, advisory bodies, trade and industry associations, and private sector participants. Among other things, the IMF's analysis includes recommendations for reforms of the national economy and is summarised in an Article IV report, which is compulsory according to article IV the IMF's Articles of Agreement, hence the name.

Since 1999, the IMF has prepared in-depth analyses of the financial system in connection with its Financial Sector Assessment Program (FSAP). The purpose is to reduce the risk of crises in the international financial markets. Since the financial sector in Denmark has been assessed to be systemically important in the international financial system, Denmark will undergo the FSAP approx. every 5 years.

In its recent FSAP report, the IMF finds that the resilience of the Danish financial system has been strengthened since its most recent analysis from 2014. This is attributable mainly to the activation of macroprudential instruments, improved supervision of banks and insurers, and strengthened crisis management frameworks.
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