Iceland Economic Outlook
November 21, 2017Iceland’s economy has remained upbeat in recent months despite adjusting to slower GDP growth. The tourism sector, which experienced double-digit growth in the year through September, helped unemployment reach a near-decade low in Q3 and contributed to higher disposable incomes. In turn, household spending rose and imports surged in October. Furthermore, while the strengthening of the krona has made imports cheaper, it has hobbled exports and weighed on GDP growth. Since 28 October’s snap elections, in which the Independence Party lost its governing majority but remained the largest bloc, messy coalition talks have so far left the Left-Green Party with the strongest chances of leading a three-party coalition government which would include Independence.
Iceland Economic GrowthA further cool-off is expected next year as the economy approaches sustainable growth, although positive spillovers from the tourism sector should moderate the slowdown. Weaker business investment is expected to be offset by stronger residential investment over the medium term. Our panelists expect GDP to expand 3.3% in 2018, which is unchanged from last month’s forecast, and 2.7% in 2019.
Iceland Economy Data
5 years of Iceland economic forecasts for more than 30 economic indicators.
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|Bond Yield||4.83||-0.99 %||Dec 06|
|Exchange Rate||104.6||-0.52 %||Dec 06|
|Stock Market||1,288||-0.32 %||Dec 06|
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