Luxembourg Economic Forecast

Luxembourg Economic Outlook

December 20, 2019

The economy seems to have lost pace in the third quarter, after expanding at the quickest clip in nearly a year in the previous quarter. Retail sales growth ebbed in the third quarter, amid downbeat consumer confidence, which suggests that household consumption likely slowed in the period. Moreover, industrial production plunged in Q3 as sentiment in the sector deteriorated further, while merchandise export growth lost pace in the quarter amid subdued global demand and elevated external uncertainty. Meanwhile, available data paints a similar picture for the fourth quarter: Pessimism among consumers deepened in October–November, while business confidence was downbeat in the same period, hinting at faltering household consumption and capital expenditure in the final months of the year.

Luxembourg Economic Growth

Economic activity is seen quickening next year on the back of robust household spending amid supportive labor market conditions. Depressed global demand and uncertainty on the international scene cloud the outlook, however. FocusEconomics analysts see growth at 2.5% in 2020, which is down 0.1 percentage points from last month’s forecast, and at 2.7% in 2021.

Luxembourg Economy Data

2014 2015 2016 2017 2018
Population (million)0.50.60.60.60.6
GDP per capita (EUR)86,59090,58991,61592,54093,569
GDP (EUR bn)46.549.851.653.355.3
Economic Growth (GDP, annual variation in %)3.74.33.92.41.5
Consumption (annual variation in %)2.04.13.21.72.9
Investment (annual variation in %)1.29.5-9.910.44.0
Exports (G&S, annual variation in %)5.316.45.33.8-1.9
Imports (G&S, annual variation in %)5.119.54.34.5-2.2
Industrial Production (annual variation in %)-7.1-2.7-8.21.56.4
Retail Sales (annual variation in %)15.18.3-30.7-52.7-23.0
Unemployment Rate6.87.16.86.35.9
Fiscal Balance (% of GDP)1.01.31.41.91.4
Public Debt (% of GDP)23.722.722.220.723.0
Inflation Rate (HICP, annual variation in %, eop)1.5-0.90.91.61.6
Inflation Rate (HICP, annual variation in %)1.70.70.10.02.1
Inflation (PPI, annual variation in %)-2.6-1.4-5.31.44.5
Policy Interest Rate (%)-  -  -  -  -  
Exchange Rate (vs USD)1.381.211.091.051.20
Exchange Rate (vs USD, aop)1.331.331.111.111.13
Current Account (% of GDP)5.45.25.15.15.0
Current Account Balance (EUR bn)2.52.62.62.72.8
Trade Balance (EUR billion)-7.4-6.7-6.0-5.7-6.3

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Luxembourg Facts

Value Change Date
Exchange Rate1.120.65 %Dec 31

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