23 September 2026
The Danish economy is recording strong growth this year despite geopolitical and trade policy turmoil. This is the conclusion reached by Danmarks Nationalbank in its new projection for the Danish economy, published today.
Growth has been driven primarily by an extraordinary increase in the pharmaceutical industry’s output abroad in the first half of the year. The Danish economy is expected to continue to grow in the coming years, driven in particular by exports, with higher public demand and rising real incomes also contributing. Global growth is supported by high activity in technology and artificial intelligence, but is also affected by the war in the Middle East and higher energy prices.
"The Danish economy has so far defied the global turmoil. We expect strong GDP growth this year, but with no signs of increased wage or price pressure. This is due to the fact that a large part of the growth comes from production abroad, which only draws on Danish labour and capital to a limited extent," says Governor Christian Kettel Thomsen.
The war in the Middle East and rising energy prices have raised inflation this year both in Denmark and in the euro area, and higher energy prices will push up inflation over the winter. However, considerable uncertainty remains, and the risk of inflation is on the rise. Further ahead, Danmarks Nationalbank assesses that price developments will remain low and stable.
Overall, the outlook is for a balanced economy with high employment and low unemployment, well-anchored inflation expectations and moderate wage increases going forward. This means that there is only limited spare capacity in the Danish economy to increase output without pushing up wage growth and inflation.
Fiscal policy will be eased significantly this year and next year, but the effect on capacity pressure is uncertain. This depends on how large a share of defence procurements is imported, and what other economic policy the government chooses to pursue.
The government’s platform also sets out a number of additional initiatives. These may put pressure on public finances if they are not financed through countervailing measures – especially if the fiscal scope proves to be smaller than estimated, or if new challenges require additional measures.
"Danmarks Nationalbank recommends that, in the Finance Bill in October, the government should not boost demand any further than already set out in August and that the government should exercise caution in using the full fiscal scope in the coming years," says Christian Kettel Thomsen.
Denmark’s gross domestic product, GDP, is expected to grow by 4.0 per cent this year, 2.3 per cent in 2027 and 2.0 per cent in 2028. Inflation is expected to be 1.7 per cent this year, 2.4 per cent in 2027 and 2.1 per cent in 2028.
On Wednesday, Danmarks Nationalbank also published an analysis of monetary and financial trends. Danmarks Nationalbank also published an analysis of AI and the labour market the week before last. The analyses can be found at www.nationalbanken.dk.
Press enquiries can be directed to Communications and Press Advisor Teis Hald Jensen by phone +45 2630 9653 or email tehj@nationalbanken.dk.