Austria: GDP records sharpest contraction since Q4 2021 in the second quarter
GDP contracted 0.7% on a seasonally adjusted quarter-on-quarter basis in the second quarter, contrasting the 0.4% expansion recorded in the first quarter. Q2’s reading marked the worst result since Q4 2021. On an annual basis, GDP declined 0.9% in Q2, contrasting the previous quarter’s 1.8% growth. Q2’s reading marked the worst reading since Q1 2021.
Household spending contracted 1.4% in Q2 (Q1: +2.1% s.a. qoq), marking the worst result since Q4 2021. Government spending bounced back, growing 1.9% in Q2 (Q1: -2.6% s.a. qoq). Meanwhile, fixed investment declined at a sharper pace of 2.1% in Q2, from the flat reading recorded in the previous quarter.
Exports of goods and services increased 3.7% on a seasonally adjusted quarterly basis in the second quarter, which was above the first quarter’s 1.3% expansion. In addition, imports of goods and services growth accelerated somewhat to 1.0% in Q2 (Q1: +0.8% s.a. qoq), marking the best performance in a year.
On the economic outlook, analysts at Erste Bank commented:
“We expect the economy to remain subdued in the coming months. However, we expect inflationary pressures to ease slowly in the coming months, which should boost real incomes and have a moderately positive impact on consumer demand. In addition, foreign trade should improve and support economic growth from the end of 2023.”