Austria: Economy expands in Q2
August 14, 2013
According to preliminary data released by the Austrian Institute of Economic Research (WIFO), GDP increased a seasonally and working-day adjusted 0.2% in Q2 over the previous period. The reading came in above the revised 0.1% increase in Q1 (previously reported: zero growth) and matched market expectations. Compared to the same period last year, GDP swung from a 0.5% contraction in Q1 to a 0.3% increase in Q2.
The second quarter improvement mainly reflects faster growth in exports. Exports of goods and services increased 0.3% in the second quarter, which followed an expansion of the same magnitude in the previous three-month period. Conversely, imports dropped 0.1% in Q2 (Q1: -0.4% quarter-on-quarter).
On the domestic front, private consumption registered nil growth in Q2. This was, however, an improvement over the 0.1% fall observed in Q1. Government spending weakened somewhat in the second quarter (Q1: +0.4% qoq; Q2: +0.3% qoq), while gross fixed investment contracted for the fourth consecutive quarter (Q1: -0.9% qoq; Q2: -0.5% qoq).
The Austrian National Bank (OeNB) expects the economy to grow 0.3% this year. For 2014, the OeNB sees economic growth at 1.5%. Meanwhile, the government sees the economy growing 0.6% this year and 1.3% in 2014.
FocusEconomics panellists are more optimistic than the Bank overall 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