Denmark Economic Forecast

Denmark Economic Outlook

December 23, 2021

Detailed national accounts data revealed that the economy expanded at a markedly softer pace than initially estimated in the third quarter. The slowdown was largely due to private consumption and fixed investment growth moderating notably, as well as government spending declining in the quarter. Regardless, the full reopening of the economy in early September played no small part in ensuring the continued albeit softer recovery. Momentum has likely waned further in the final quarter of the year: Consumers have turned pessimistic in Q4, markedly contrasting Q3’s upbeat optimism, which, coupled with higher price pressures in October–November, has likely dragged on household spending. Moreover, the government has been gradually reintroducing measures to contain the spread of the Omicron variant since early December, which has likely dragged on activity at the tail end of the year.

Denmark Economic Growth

GDP growth is seen cooling slightly next year following 2021’s projected bounce-back, although momentum will remain strong, boosted by a tighter labor market, continued wage growth and healthier private spending. Brisker export growth will also sustain activity. However, high household debt levels could cap the improvement and uncertainty over the pandemic remains a risk. FocusEconomics analysts see the economy growing 3.1% in 2022, which is up 0.1 percentage points from last month’s projection, and 2.1% in 2023.

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Denmark Facts

Value Change Date
Bond Yield-0.15-1.54 %Jan 01
Exchange Rate6.66-0.57 %Jan 01

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