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Denmark cuts 2016, 2017 GDP forecasts: govt report
May 26, 2016 / 7:11 PM / 2 years ago

Denmark cuts 2016, 2017 GDP forecasts: govt report

COPENHAGEN (Reuters) - Denmark slashed its estimate for economic growth this year to 1.1 percent from the 1.9 percent it forecast in December, according to a government report seen by Reuters on Thursday.

The Sun sets over a smoking power plant in Copenhagen December 12, 2009. REUTERS/Christian Charisius

The government also cut its growth forecast for 2017, to 1.7 percent from 2.0 percent, the paper - which is due on Friday - showed.

The Scandinavian country’s export-driven economy, which grew 1.2 percent last year, is dependent on the fortunes of its larger neighbors, with 15 percent of foreign sales going to Germany and 10 percent to Sweden.

Several banks and other organizations have cut their 2016 growth forecast in recent months, with Nordea and Citi estimating 1.3 percent and 1.1 percent, respectively.

The report also said the government’s budget deficit should come in at 2.0 percent of GDP this year rather than the 2.8 percent forecast earlier. The EU threshold is 3 percent.

Inflation should hit 0.4 percent in 2016, down from the 0.9 percent earlier expected.

Reporting by Erik Matzen, editing by Jacob Gronholt-Pedersen and John Stonestreet

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