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Global Economic Boom Gradually Spreading to the Euro Area and to Austria. Economic Outlook for 2004 and 2005


  • Markus Marterbauer



The Austrian economy is expected to grow by 1.7 percent in volume this year, driven mainly by higher exports. Austrian manufacturing, due to its close supply ties, is benefiting from the swift recovery in the German export-oriented sector. Investment is tentatively heading up, with spending on machinery and equipment boosted by rising sales expectations of firms and construction activity driven by buoyant investment in road and railroad infrastructure. Private household consumption remains subdued, because of sluggish income growth, although cuts in direct taxes next year should provide some forward momentum. The substantial increase in raw material prices, notably for crude oil, is pushing up inflation by some ¼ percentage point to an annual rate of 1.9 percent this year. Employment is set to gain 0.6 percent this year, assuming the usual reaction pattern to stronger activity. The sizeable inflow of foreign workers will nevertheless keep unemployment at its present level.

Suggested Citation

  • Markus Marterbauer, 2004. "Global Economic Boom Gradually Spreading to the Euro Area and to Austria. Economic Outlook for 2004 and 2005," Austrian Economic Quarterly, WIFO, vol. 9(3), pages 103-114, August.
  • Handle: RePEc:wfo:wquart:y:2004:i:3:p:103-114

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    References listed on IDEAS

    1. Wiji Arulampalam & Alison L. Booth & Mark L. Bryan, 2004. "Training in Europe," Journal of the European Economic Association, MIT Press, vol. 2(2-3), pages 346-360, 04/05.
    2. Soskice, David, 1990. "Wage Determination: The Changing Role of Institutions in Advanced Industrialized Countries," Oxford Review of Economic Policy, Oxford University Press, vol. 6(4), pages 36-61, Winter.
    3. Wolfgang Pollan, 2002. "The Procedures of the Parity Commission and of its Sub-Committee on Wages," WIFO Working Papers 184, WIFO.
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    Economic Outlook; Austria;


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