Denmark applauded for inclusive economy

The country continues to impress with high living standards and employment rates, along with low levels of income inequality, Fund economists have said.  The outlook is for continued solid growth and gradually rising inflation and wages, with output rising above trend to reach 1.7% and 1.9% in 2019 and 2020 respectively. The Fund said growth remained solid in 2018 and was supported by domestic demand, with the economy operating above potential for the third year in a row. The labour market is also strong, wage growth has picked up in line with productivity, inflation remains moderate, and strong public finances mean debt is sustainable. The IMF believes private consumption and investment will be the key drivers of growth in the medium term as a result of structural reforms and higher investment. However, it warns that risks posed by an expected slowdown in Denmark’s main trading partners could slow export growth. Moreover, Fund economists point to vulnerabilities caused by high household debt and the impact upon confidence in the financial markets of a high-profile Danish money laundering case.

- Public Finance International -



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