Luxembourg Economic Outlook
October 27, 2020Incoming data suggests the economy gradually recovered in the third quarter, after GDP contracted for the first time in nearly eight years in the second quarter on the blow dealt by the coronavirus health crisis. New car registrations rallied in July and August, hinting at improved consumer spending in the quarter as restrictions were gradually lifted. Moreover, the unemployment rate logged the lowest reading in six months in September, indicating that the labor market continued to stabilize. Meanwhile, economic sentiment improved overall in the quarter, albeit deteriorating slightly in September amid renewed Covid-19 concerns as cases spiked again. Meanwhile, on 14 October, the government laid out its 2021 draft budget, aimed at containing the fallout from the Covid-19 crisis and supporting a healthy recovery, particularly through increased investment of 4.3% of GDP (EUR 2.7 billion).
Luxembourg Economic GrowthThe economy is set to rebound in 2021, after this year’s projected contraction due to the coronavirus shock. Household spending should recover as the labor market stabilizes, while investment activity is set to bounce back. Firming global demand should support a recovery in the external sector. A protracted health crisis clouds the outlook, however. FocusEconomics analysts see GDP expanding 5.6% in 2021, which is down 0.6 percentage points from last month’s forecast, and 3.7% in 2022.
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Luxembourg Economic News
December 14, 2020
The economy rebounded in the third quarter, with GDP expanding 0.5% year-on-year, contrasting the 7.8% contraction recorded in the second quarter. The upturn reflected the easing of Covid-19 containment measures, which drove a notable improvement in domestic demand.
December 9, 2020
Consumer prices fell a seasonally-adjusted 0.21% in November over the previous month, which was below the 0.03% fall recorded in October.
November 20, 2020
In October, the number of unemployed workers came in at 17,971, which was up 0.5% from September’s result of 17,875.
November 9, 2020
Consumer prices dropped a seasonally-adjusted 0.03% in October over the previous month, a more moderate decrease than September's 0.07% fall.
October 20, 2020
In September, the number of unemployed workers came in at 17,875, which was down 3.5% from July’s result of 18,525.