Page 111 - Annual Report KELAG Group 2018
P. 111

Economic  growth  accelerated  further  in  Austria  in  2018.
                                                                  Following growth of 2.6% in 2017, current forecasts indicate
                                                                  that gross domestic product will increase by around 3.0% in
                                                                  real  terms  in  2018. The  Austrian  economy  proved  to  be
                                                                  surprisingly robust in comparison to other countries. Due
                                                                  to global developments, however, growth in exports is also
                                                                  expected  to  slow  in  Austria  in  2019.  Consumption  by
                                                                  private households will therefore no longer be able to fully
                                                                  compensate for the associated decline in the willingness of
                                                                  companies to invest and falling demand in foreign trade.
                                                                  According to current forecasts by the Economic Research
                    Currency crises in emerging economies, the strategic trade   Institute (WIFO), economic growth in Austria will thus slow
                    policies  of  the  US  and  the  fruitless  search  to  date  for  a   to around 2.0%.
                    solution  to  the  UK’s  exit  from  the  EU  dampened
                    developments  of  global  trade  as  of  the  end  of  the  year.   The economy’s growth coupled with labour market policies
                    Consequently,  both  the  Organisation  for  Economic   paves the way for employment to increase above the labour
                    Cooperation  and  Development  (OECD)  and  the   supply in Austria up to and including 2019, thus lowering
                    International  Monetary  Fund  (IMF)  had  more  pessimistic   the  unemployment  rate.  According  to  calculations  by
                    outlooks  for  global  economic  growth.  According  to   Eurostat, the unemployment rate was around 5.2% in 2018.
                    forecasts  from  the  fourth  quarter  of  2018,  the  year  was   A further decline to 5.0% is expected for 2019.
                    expected  to  end  with  global  economic  growth  of  3.7%.
                    Growth  of  3.7%  has  also  been forecast  for  2019.  In  May,   The inflation rate remained at around 2.1% in 2018. This
                    higher growth rates had still been anticipated. The reasons   rather  modest  increase  considering  the  strong  economy
                    cited for the less optimistic outlook for growth are not only   exceeds the ECB’s target of 2.0% only slightly. The rise in
                    the  negative  effects  of  trade  policy  measures  but  also   energy prices can be pinpointed as the main driver of the
                    tighter  financing  opportunities  as  a  result  of  loans   development over the course of 2018. An inflation rate of
                    becoming more expensive and the higher oil prices for a   around 2.0% on average is anticipated for the period up to
                    number of emerging and developing countries.   2022.

                    Economic growth also remained high in the majority of EU
                    states and in the euro zone. Most recent estimates project
                    annual economic growth in the euro zone for 2018 to be
                    around 2.1%, following 2.4% in 2017. The bond purchase
                                                                  Electricity  consumption  throughout  Austria  increased  by
                    programme of the European Central Bank (ECB) ended at
                                                                  0.3% on the prior year to a total of 71.3 TWh in 2018. On the
                    the end of 2018. The key interest rate of the ECB has been
                                                                  production side, there was again an increase in renewable
                    at a historic all-time low of 0.0% since March 2016. In the
                                                                  energy in Austria. For instance, the installed wind power
                    medium  term,  economists  and  financial  experts  assume
                                                                  capacity increased by 201 MW to the current level of 3,045
                    that the yield curve will gradually increase owing to rising
                                                                  MW.
                    inflation  rates  and  moderate  fears  about  cyclical
                    developments. In a historical comparison, the general level
                    of interest rates is, however, expected to remain low.
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