Austria: Economic growth stalls in first quarter
June 10, 2013
In the first quarter, GDP growth was flat over the previous period in seasonally and working day adjusted terms, according to revised data released by the Austrian Institute of Economic Research (WIFO). The reading matched the preliminary estimate and came in above the 0.1% contraction registered in the last quarter of 2012. Compared to the same quarter last year, GDP declined a revised 0.7% in Q1 (initially reported: -0.6% year-on-year), which reversed the 0.7% expansion registered in Q4.
As shown in the flash estimate, private consumption registered nil growth in Q1, while government spending was revised down to a 0.3% expansion (previously reported: +0.5% quarter-on-quarter). Meanwhile, gross fixed investment decreased 0.4% over the fourth quarter, which was slightly up from the 0.5% drop initially reported.
On the external front, exports of goods and services grew 0.2% in Q1 (previously reported: +0.3% qoq), while imports were revised to a 0.1% expansion in the same period (previously estimated: +0.3% qoq). As a result, the external sector's net contribution to overall economic growth swung from a 0.2 percentage-point contribution in Q4 to a flat reading in Q1.
The Austrian National Bank (OeNB) revised its growth forecasts for this year and next, amid weak global demand. Accordingly, the Bank expects the economy to grow 0.3% this year, which is down from its December 0.5% estimate. For 2014, the OeNB also trimmed its projections by 0.2 percentage points and sees economic growth at 1.5%.
FocusEconomics panellists are more optimistic than the Bank and project the economy to grow 0.8% in 2013, which is unchanged from last month's estimate. For 2014, panellists expect the economy to grow 1.7%.
Author: Ricardo Aceves, Senior Economist