Iceland Economic Outlook
April 30, 2018Despite recent figures suggesting a continuation of the relatively sluggish performance from Q4 2017, the economy appears to have started the year in good shape. Although real wage growth has eased in recent months due to creeping inflation, which likely capped private consumption gains in Q1, it remained robust by historical standards and supported by near-full employment. Meanwhile, consumers had a less optimistic outlook in March, but this likely reflected their weaker expectations of conditions improving further given their already high satisfaction with the current state of the economy and labor market. In addition, the external sector posted strong gains in Q1 as the goods trade deficit shrank considerably year-on-year thanks to stronger exports of marine products, although the improvement was partially the result of a base effect.
Iceland Economic GrowthEconomic activity is expected to moderate slightly this year as the tourism boom wanes and exports weaken. Private consumption growth will also soften somewhat but will be the key driver of growth going forward. Our panelists expect GDP to rise 3.4% in 2018, which is down 0.1% percentage points from last month’s forecast, and 2.9% in 2019.
Iceland Economy Data
|GDP per capita (USD)||46,012||51,672||51,051||59,524||-|
|GDP (USD bn)||15.0||17.0||17.0||20.0||-|
|Economic Growth (GDP, annual variation in %)||4.4||1.9||4.1||7.2||-|
|Consumption (annual variation in %)||1.0||2.9||4.3||6.9||-|
|Investment (annual variation in %)||2.2||16.0||17.8||22.7||-|
|Exports (G&S, annual variation in %)||6.7||3.2||9.2||11.1||-|
|Imports (G&S, annual variation in %)||0.1||9.8||13.5||14.7||-|
|Retail Sales (annual variation in %)||2.0||6.6||11.0||12.3||-|
|Fiscal Balance (% of GDP)||-1.8||-0.1||-0.8||12.9||-|
|Public Debt (% of GDP)||84.7||82.4||68.1||53.2||-|
|Inflation Rate (CPI, annual variation in %)||3.9||2.1||1.6||1.7||-|
|Inflation (PPI, annual variation in %)||-4.4||-0.7||5.1||-8.1||-|
|Policy Interest Rate (%)||6.00||4.50||5.75||5.00||-|
|Stock Market (annual variation in %)||27.5||11.6||38.0||-6.7||-|
|Exchange Rate (vs EUR)||158.5||154.3||141.3||119.1||-|
|Exchange Rate (vs EUR, aop)||162.2||154.9||146.3||133.7||-|
|Current Account (% of GDP)||6.2||4.0||5.3||8.1||-|
|Current Account Balance (USD bn)||0.9||0.7||0.9||1.6||-|
|Trade Balance (USD billion)||0.0||-0.3||-0.6||-1.2||-|
5 years of Iceland economic forecasts for more than 30 economic indicators.
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|Bond Yield||5.31||-0.99 %||May 21|
|Exchange Rate||114.7||-0.52 %||May 21|
|Stock Market||1,347||-0.32 %||May 18|
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