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Iceland: Recent Economic Developments

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  • International Monetary Fund

Abstract

This paper reviews economic developments in Iceland during 1990–96. It analyzes the origins of the current economic expansion associated with a swing in the current account and in emerging inflation pressure. Three driving forces are emphasized: the positive supply shock affecting the fisheries; the expansion of the power intensive industry; and brisk increases in real wages over the past two years (1995–96). The paper highlights that the main sources of upside risks comprise the likely construction of a new aluminum smelter.

Suggested Citation

  • International Monetary Fund, 1997. "Iceland: Recent Economic Developments," IMF Staff Country Reports 1997/015, International Monetary Fund.
  • Handle: RePEc:imf:imfscr:1997/015
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