18 September 2019
The Danish economy has shown solid growth for a number of years, and that continued in the 1st half of 2019. So far, the Danish economy has thus defied the slowdown seen in several of Denmark's largest trading partners over the past year.
This is Danmarks Nationalbank's conclusion in a new outlook for the Danish economy, forecasting an increase in the gross domestic product, GDP, of 1.8 per cent this year. Over the next two years, GDP is expected to rise by 1.5 per cent per year.
"So far, we have weathered the headwinds faced by some of the major economies. But we are not immune. Over time, slower growth abroad will affect a small, open economy like Denmark. We are headed for slightly slower growth over the coming years," says Governor Lars Rohde, Danmarks Nationalbank.
Although growth decelerates slightly, the Danish economy will still be in a boom period, according to Danmarks Nationalbank's projection. Slightly slower growth in a boom period may help prevent the economy from overheating, thereby safeguarding it from the risk of a subsequent deep recession.
"A slight slowdown does not imply that we are on the brink of a downturn or recession. Therefore, fiscal policy in Denmark should not be eased in the current situation," says Governor Lars Rohde.
The projection for the Danish economy is based on the assumption of a moderate slowdown in the global economy. However, over the last half year, the risk of a more pronounced slowdown in the global economy has increased. International trade policy tensions have escalated, and the Brexit outcome remains unknown.
Since the current boom in the Danish economy has evolved without significant imbalances being built up, the economy is well prepared – even for somewhat lower growth abroad.
Enquiries can be directed to press advicer Ole Mikkelsen on tel. +45 3363 6027.