Bank Austria Economics & Market Analysis Austria. Austrian Economy. July

Transcription

1 Bank Austria Economics & Market Analysis Austria Austrian Economy July

2 Austrian Economy Author: Walter Pudschedl Imprint Published by UniCredit Bank Austria AG Schottengasse -8 Vienna Telephone + ()-97 Fax + ()- econresearch.austria@unicreditgroup.at As of July Bank Austria page

3 Austrian Economy Overview 9 Revision ) Revision ) Revision ) Revision ) GDP (real, in %) Inflation (CPI in %)..9.. ) Revision since the last report of May Economic expansion has passed its peak growth forecast for unchanged at. per cent Slight decline in inflation to. per cent in May inflation expected to persist at over per cent for the time being Retail sales in negative territory from January to April outlook remains subdued Rise in employment, decline in unemployment but the labour market upturn is losing some of its momentum Export growth and industrial output have slowed foreign demand and industry remain growth engines Strong rise in tax revenues compliance with the Maastricht criterion for the budget deficit in is conceivable Thanks to strong GDP growth in the first quarter, the Austrian economy will in grow much more dynamically than in the previous year despite a slowing of the momentum. We still anticipate GDP growth of. per cent. The growth outlook for, with GDP growth of.8 per cent, is much more moderate than that for the current year. The pace of recovery will be dampened by the following factors: higher inflation driven by commodity price trends; restraint by companies and private households in many parts of the world; less risk tolerance among economic players; and the impact of the consolidation of publicsector budgets coupled with a steady tightening of monetary policy. The upward trend in inflation since the beginning of the year was interrupted in May. The inflation rate has remained unchanged month-on-month, falling to. per cent in a comparison with the previous year. Inflation averaged. per cent in the first five months. In the coming months it will remain above. per cent as a result of high commodity prices and initial second-round effects. We see average inflation of. per cent for. The positive trend in retail sales discontinued at the beginning of. The first four months saw a.7 per cent decline in retail sales year-on-year. The general environment (slowdown in the improvement in employment, higher inflation, slight easing of global economic growth, budget consolidation) is less favourable than in the previous year. Retail sales in will fall short of the very good result of the previous year (+. per cent). The labour market is experiencing the full benefits of economic recovery. Employment has reached a new record high after rising by an average.8 per cent between January and May in a comparison with the previous year. Due to economic developments, employment in the second half of will not match the strong growth seen in the first few months of the current year. Since the beginning of the second quarter there have been growing signs that export-driven industrial activity has been losing some of its momentum, while remaining a very dynamic component. We now expect industrial output to grow by as much as 8 per cent in, thereby surpassing the strong.7 per cent growth of the previous year. Robust foreign demand we see nominal merchandise export growth of over per cent will continue to drive industrial activity. The continued strong economic upturn, and inflation which has meanwhile risen to over per cent, should in the current year enable the government not only to reduce the budget deficit to the planned level of.9% of GDP. Indeed, they may even give the government a better starting position for the financial plan for the period - that was adopted in the middle of May. It is therefore not to be ruled out that new debt may fall to below per cent earlier than planned, possibly in the coming year. This would also pave the way for somewhat slower growth of total public debt, which according to the financial plan is anticipated to rise to up to 7. per cent of GDP (). Bank Austria page July

4 Austrian Economy Austrian Economic Forecast forecast Real change in % GDP Private consumption Public consumption Gross fixed capital formation*) Investments in plant and machinery Investments in construction Exports Imports CPI (change in %) HCPI (change in %) Current account (in EUR bn) Current account (in % of GDP) Employment in s**) change in % Unemployment rate (nat. def.) Unemployment rate (EU def.) Unemployed (annual average in,) 7 General gov. balance (in % of GDP) Public-sector debt (in % of GDP) Nominal GDP (in euro bn) *) excluding changes in inventory **) excluding persons drawing maternity benefits, military service and training Bank Austria Bank Austria page July

5 Austrian Economy - Forecast GDP (real) Inflation (CPI) forecast / / / / / / / /7 /8 /9 / / / Wesentliche Rahmenbedingungen estimate forecast forecast (Real change in %) GDP Eurozone GDP growth Private consumption Public consumption US GDP growth Gross fixed capital formation UniCredit MIB Investments in plant and machinery Investments in construction Exports Imports (yearly average) 9 CPI (change in %) HCPI (change in % ) USD per euro forecast Employment (change in %)*) Crude oil (USD per brl)* 8 Unemployment rate (nat. def.) Unemployment rate (EU def.) y gov. bonds.9..8 n.a. General gov. balance (in % of GDP) months money..8.. Public sector debt (in % of GDP) UniCredit MIB, Thomson Reuters * Futures *) excluding maternity/paternity leave, military service and training programmes July

6 Austrian Economy - Data I II III IV I 9/ / / / / / / / / / Bank Austria Business Indicator GDP growth (prev. quarter, annualised) Industrial confidence Eurozone Germany France Italy Netherlands Spain Bank Austria Industrial confidence Eurozone Bank Austria Purchase Manager s Index Backlog of work New export orders Output expectations Industrial confidence Austria Industrial output change against previous year change against previous month (saisonal adjusted) Foreign trade Exports (change against previous year in %) Exports (chg. against prev. month, s.a. in %, m mov. av.) Imports (change against previous year in %) Imports (chg. against prev. month, s.a. in %, m mov. av.) Ex-Im (m cum., euro bn) Construction Confidence indicator July

7 Austrian Economy - Data I II III IV I 9/ / / / / / / / / / Retail trade Confidence indicator Retail trade nom. (change against previous year in %) Retail trade nom. (change against previous year in %, mav.) Retail trade real (change against previous year in %) Retail trade real (chg. against prev. month in %, s.a., mav.) Automobile trade nom. (change against prev. year in %) Tourism Overnight stay (change against previous year in %) Labour market Employment*) (change against previous year in %) Employment (s.a., change against previous month in %) Unemployed (change against previous year in ) Unemployment rate (in %, s.a.) Prices CPI (change against previous year in %) HCPI (Change against previous year in %) Prices of raw materials (change against prev. year in %) Crude oil (change against previous year in %) Financial market M Euribor year government bonds USD per euro Total loans (change against previous year in %, eop) Consumption loans (change against prev. year in %, eop) *) excluding maternity/paternity leave, military service and training programmes July

8 Austrian Economy - Graphs GDP and industrial production GDP (yoy in %, real; left scale) Industrial production (yoy in %; m avg.; right scale) Industrial and consumer confidence Industrial confidence Consumer confidence Austria's exports and imports Bank Austria Business Indicator Imports (yoy in %; m avg.) Exports (yoy in %; m avg.) GDP (yoy in %, real) Bank Austria Business Indicator Economics - and Market Analysis July

9 Austrian Economy - Graphs Unemployed Employment Unemployed (yoy in,; right scale) Unemployment rate (in %; seasonally adjusted; left scale) 8-9 Employed (excl. matern./patern. leave) - left scale yoy in % excl. matern./patern. leave, military serv. and train. progr. - right scale Inflation rate Retail trade HCPI (yoy in %) CPI (yoy in %) Retail trade (yoy in %; real; m avg.; left scale) Confidence indicator (right scale) July

10 Money market Euro area (in %) -M money (in %) -M-Euribor Repo Marginal lending facility Deposit facility Euribor USD Libor M money (in %) UK Schweiz Japan UK Japan Japan Switzerland Schweiz Financial forecasts 9// in m in 9m Euro-m money market..7. Forwards Euro-y German bonds.99.. Euro-y Austrian bonds.8.8. US$-m money market... Forward..7 US-y treasuries..8. CHF/Euro... Forwards.. US$/Euro... Forwards.. Source: Datastream, Bloomberg, Bank Austria; Forecast: UniCredit Research July

11 Long-term interest rates -Y Government bonds (yield in %) -Y Government bonds (yield in %). US Treasury Germany... UK Switzerland Japan Y Goverment bonds (yield in %) Interest rate differential Austria - Germany Austria July

12 Equity market USA - Euro area Germany - Euro area Dow-Jones (left scale) Euro-Stoxx (right scale) DAX (left scale) Euro-Stoxx (right scale) UK - Japan Austria - Euro area FTSE (left scale) NIKKEI (right scale) ATX (left scale) Euro Stoxx (right scale) July

13 Exchange rates USD per Euro SFR per Euro Yen per Euro GBP per Euro July

14 Austrian Economy - Selected indicators Forecast Change against prev. year in % GDP (real) Industrial output (real) Gross fixed capital formation (real) CPI (yearly average) Unemployment rate (yearly average) General gov. balance (in % of GDP) GDP (nom., Euro bn) Per capita GDP (in euro) 8,9 9,,78,79,97,8,9,9,8 in EUR mn Merchandise exports 89,88 9,7,7,8 7, 9,79 9,9,9,88 Merchandise imports 9,9 9,99,, 9,8 97,7,,7,9 Current account balance,,9 7,8 9,,77 8,9 7,79 9,, Current account balance (in % of GDP) Foreign direct investment (inflow, net), 8,7,,7,8,7,99,, Gross foreign debt (end of period),, 88,8,9 98,7 7,7 8, 9,, Gross foreign debt (in % of GDP) Import cover (in months) *) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. EUR (yearly average) EUR/USD (yearly average) *) not useful for Austria as a member of the eurozone Source: Bank Austria, OeNB, Wifo, UniCredit Research July

15 Austrian Economy Austrian Economy We invite you to visit the economic analyses on Bank Austria s website: under "Analyses & Research" in the section "Economic Research" or directly at If you would like to receive information on our most recent publications by , please subscribe to the newsletter Bank Austria EconomicNews on the website. If you have further questions, please send us an to econresearch.austria@unicreditgroup.at Disclaimer of liability The opinions of the authors do not necessarily reflect those of Bank Austria and those of the companies which have engaged the services of the authors. The information contained in this publication is not to be interpreted as an offer or invitation for the sale or purchase of securities of any kind. We reserve the right to modify the views expressed in this publication at any time without prior notification. Bank Austria