Denmark: Activity bounces back to growth in Q2
August 16, 2021
Economic activity rebounded in the second quarter, according to a preliminary release. GDP expanded 2.2% in seasonally-adjusted quarter-on-quarter terms (Q1: -1.0% s.a. qoq), marking the best result since Q3 2020 and returning to pre-pandemic levels. Moreover, the Danish economy outperformed the Euro area’s average expansion of 2.0%, although it had shrunk at a more pronounced rate in the prior quarter compared to the 0.3% contraction logged in the Euro area. On an annual basis, the economy logged its best result since at least Q1 1992, with GDP rising 8.2% (Q1: -0.8% year-on-year).
The quarterly result was largely due to growth in the retail and culture sectors on the back of the gradual lifting of restrictions. Moreover, growth in public sector activity—especially in the health sector—also contributed significantly to the reading. Lastly, employment levels increased in the quarter, likely bolstering household spending, which should have recovered from Q1’s contraction resulting from tighter Covid-19 restrictions.
A more detailed release will be published on 31 August.
Author: Marta Casanovas , Junior Economist