Luxembourg: Growth softens in Q4 amid softer household spending
Growth decelerated to 1.7% year-on-year in Q4 2018, from Q3’s 2.8% outturn. The slowdown was chiefly led by softer household spending at year-end, according to detailed data released by the Statistical Institute (STATEC) on 21 March. Taking the year as a whole, GDP grew 2.6% in 2018, up from 2017’s 1.5% upshot.
Domestic activity lost momentum in the fourth quarter amid hiccups in household spending growth, which decelerated to 3.2% on an annual basis (Q3: +4.2% year-on-year). On the other hand, fixed investment rebounded in Q4, up 3.3% year-on-year after it fell 2.1% in Q3. In addition, government spending growth gained traction, accelerating from 3.9% in Q3 to 4.7% in the last quarter of 2018.
Looking at the external sector, year-on-year export growth softened, coming in at 3.2% in Q4 (Q3: +4.0% yoy) amid a broad-based deceleration across the Eurozone’s largest economies. Similarly, imports slowed in the quarter, expanding 3.9% after rising 4.5% in Q3.
On a quarter-on-quarter, seasonally-adjusted basis, GDP growth in the fourth quarter came in at 0.3%, down from the 0.5% expansion recorded in the third quarter.