Belgium Economic Forecast

Belgium Economic Outlook

December 20, 2019

A second release confirmed economic growth accelerated in the third quarter, after slowing in the second quarter. Although domestic demand eased, it surpassed expectations thanks to surprisingly resilient private consumption. Meanwhile, the external sector weighed less on the overall expansion than in Q2, as a decline in imports cushioned a fall in exports. Turning to the fourth quarter, growth is expected to slow somewhat: Fixed investment likely remained subdued against the backdrop of weak external demand and lackluster sentiment in the construction and manufacturing sectors. That said, private consumption should buffer the slowdown thanks to a tighter labor market in October. Meanwhile, in politics, the country will most likely end the year without a federal government as negotiations drag on. The fiscal deficit is widening as a result of the lack of coordination, as regional governments begin to ramp up expenditure.

Belgium Economic Growth

Growth is expected to soften next year as looming uncertainties weigh on sentiment. Although domestic demand is likely to stay healthy on upbeat private consumption, lingering uncertainties stemming from Brexit and a subdued Eurozone backdrop are seen weighing on investment. Difficulties in forming a federal government and risks of fiscal slippage continue to cloud the outlook. FocusEconomics analysts see growth at 1.1% in 2020, which is up 0.1 percentage points from last month’s forecast, and at 1.3% in 2021.

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Belgium Facts

Value Change Date
Bond Yield0.100.15 %Dec 31
Exchange Rate1.120.65 %Dec 31

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