Economic Outlook for 1990 and 1991: Cyclical Boom Accompanied by Rising Current Account Surplus
The short-term outlook for the Austrian economy is very favourable. Demand and output are expected to grow by more than 4 percent annual rate over the next 18 months, faster than productive capacities. Strains typically associated with a sustained boom period are however unlikely to emerge. Inflation will accelerate only little, and the current account will move into surplus for the whole of 1990, improving further in 1991. The number of jobs being created is remarkably high and yet, unemployment will continue to rise. From the previous forecast last March growth of real GDP is revised upwards by 1 percentage point each – to 4½ percent for 1990 and 4 percent for 1991. The revision starts from a higher base as activity proved surprisingly buoyant in the first quarter of 1990 moving to a year-to-year increase by more than 5 percent. A new and self-sustained upswing has come under way, in which manufacturing industry plays a key role. Output will rise by about 8 percent this year and firms envisage an increase of their investment expenditure by no less than 30 percent. The optimism of entrepreneurs is matched by that of consumers. Purchases of durables went up by 15 percent in the first quarter and total consumption will rise by 4¼ percent in 1990, the highest rate in seven years. Despite the rebound in domestic demand the current account will improve by some AS 5 billion both this year and next, yielding a surplus in the order of AS 10 billion in 1991. The positive trend is brought about by favourable terms of trade and steadily rising net receipts from foreign travel.
|Year of publication:||
WIFO Monatsberichte (monthly reports). - Österreichisches Institut für Wirtschaftsforschung (WIFO), ISSN 0029-9898. - Vol. 63.1990, 7, p. 396-410
Österreichisches Institut für Wirtschaftsforschung (WIFO)
|Subject:||Prognose für 1990 und 1991. Hochkonjunktur mit wachsendem Leistungsbilanzüberschuß | Economic Outlook for 1990 and 1991: Cyclical Boom Accompanied by Rising Current Account Surplus|
|Description of contents:||Abstract|
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