IMF predicts Denmark’s economy to reach 1.9 percent this year, 1.6 percent next year
Date
9/15/2024 9:29:22 AM
(MENAFN) The International Monetary Fund (IMF) has projected Denmark's economic growth at 1.9 percent for this year and 1.6 percent for the next. According to the IMF's Staff Concluding Statement from the 2024 Article IV Mission, the country's Economy is expected to continue expanding at a rate of 1.6 percent in 2025, following a stronger growth of 2.5 percent last year. The forecast reflects a transition from the robust growth seen in the previous year to a more moderate pace in the near term.
The IMF attributes the expected slowdown in economic growth to a reduction in the expansion of pharmaceutical and maritime exports. However, it also anticipates some positive contributions to growth from a recovery in external demand, improved consumer purchasing power, and further easing of financial conditions. Despite these positive factors, the IMF notes that the overall balance of risks remains tilted to the downside. Key concerns include a potential global economic slowdown, the possibility of escalating conflicts in Gaza and Israel and ongoing tensions related to Russia’s war in Ukraine, as well as increasing geoeconomic fragmentation.
Inflationary trends have shown a significant shift, with the IMF estimating an average inflation rate of 1.8 percent for 2024, compared to 3.4 percent last year. The IMF attributes the decrease in inflation to falling global energy prices and subdued domestic demand. This reduction in inflationary pressures has been evident in recent months.
Despite the current decline in inflation, the IMF warns that inflation might experience a temporary uptick in the coming months. This potential increase is expected to result from the lagged impact of last year’s wage collective bargaining agreements. However, inflation is projected to stabilize around 2 percent during the latter half of 2025 as these effects dissipate.
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