Luxembourg: Growth softens in Q1 amid across-the-board slowdown
June 21, 2019
Growth decelerated to 1.6% year-on-year in Q1, from Q4 2018’s revised 1.8% outturn (previously reported: +1.7% year-on-year). The slowdown was chiefly led by a deceleration in household spending, according to detailed data released by the Statistical Institute (STATEC) on 21 June.
Domestic demand lost stride in the first quarter amid a broad-based deceleration. Household spending grew 1.6% on an annual basis, markedly below Q4 2018’s revised 4.2% increase (previously reported: +3.0% yoy). Moreover, fixed investment rose 1.3% year-on-year, down from the previous quarter revised 3.7% upturn (previously reported: +0.4% yoy). Lastly, government spending growth also lost traction, easing from a revised 4.4% in Q4 2018 to 4.0% in Q1 (previously reported: +4.7% yoy).
Looking at the external sector, year-on-year export growth narrowed, coming in at 1.7% in Q1 (Q4 2018: +3.2% yoy) amid a wider deceleration across the Eurozone’s largest economies. Similarly, import growth slowed in the quarter, expanding 1.3% after Q4 2018’s revised 4.0% outturn (previously reported: +3.9% yoy).
On a quarter-on-quarter, seasonally-adjusted basis, GDP growth in the fourth quarter came in at 0.3%, half that of the revised 0.6% expansion recorded in Q4 2018 (previously reported: +0.3% yoy).
Author: Nicolás J. Aguilar, Economist