Press releases are short texts about important news from Danmarks Nationalbank. Press releases are primarily aimed at journalists or those interested in instant and direct news updates, for example on interest rate changes.

About Danmarks Nationalbank

The economy is in a solid upswing, but it is important to avoid overheating

​Danmarks Nationalbank expects the gross domestic product, GDP, to grow by 2.3 per cent this year. In 2018 and 2019, growth is expected to be 1.8 and 1.7 per cent, respectively.


Share

13 September 2017

The upswing in the Danish economy has been solid and well-balanced. There is a good chance that this can continue, but it is important to avoid overheating of the economy. That is the assessment of Danmarks Nationalbank in a new projection of the Danish economy.

"In the coming years, when the Danish economy will be in a boom, fiscal policy should not stimulate demand further, but rather contribute to ensuring that growth does not overstretch capacity," says Governor Lars Rohde, Danmarks Nationalbank.

Danmarks Nationalbank expects the gross domestic product, GDP, to grow by 2.3 per cent this year. In 2018 and 2019, growth is expected to be 1.8 and 1.7 per cent, respectively.

"We have previously seen that the economy can overheat vigorously and suddenly when it is booming. The government should be prepared to step in and tighten fiscal policy with a view to dampening growth in demand," says Lars Rohde.

The growth pattern emerging in the projection of the Danish economy indicates stronger pressure on production capacity in the coming years, and at the same time it will become more difficult for firms to employ the right people.

Employment has risen continuously since the upswing gained momentum in 2013, supported by structural reforms that have made more people stay in the labour market for longer. It makes good sense to continue recent years' work to implement structural reforms, e.g. to increase the supply of labour, but in the opinion of Danmarks Nationalbank this cannot be expected to ease pressure on the labour market substantially within the next couple of years.

Enquiries can be directed to Ole Mikkelsen, tel. +45 3363 6027.