Danish economy shrinks but unemployment drops

Danish economy shrinks but unemployment drops
Unemployment is at its lowest level since April 2009. Photo: Thomas Lekfeldt/Scanpix
Denmark saw its economy contract for the first time since 2013 while unemployment fell to its lowest level in over six years, official data showed on Monday.
Denmark saw its economy shrink by 0.1 percent in the third quarter after eight straight quarters of growth.
Statistics Denmark attributed the slowdown to a drop in exports and industrial production.
Despite the dip, the Danish economy remained strong compared with 2014, with growth of 1.4 percent in the first three quarters of the year compared to the previous year, Statistics Denmark said.
The agency said “the increase in household consumption and activity in business services” had allowed Denmark to finally return to the level of output it had before the financial crisis of 2008, excluding North Sea oil.
Statistics Denmark also released its monthly unemployment figures on Monday, showing the seasonally adjusted figure had dropped to 4.5 percent in October, the lowest level since April 2009.
In the past year, the Danish economy has created 14,000 jobs, an increase of 0.5 percent in employment, it said.
In neighbouring Sweden meanwhile, the economy posted strong third quarter growth on robust household consumption and rising investment. Sweden's gross domestic product grew by 0.8 percent in the quarter compared to the previous three-month period, Statistics Sweden said.
Year-on-year growth, which was driven mainly by exports, was 3.9 percent.
These figures are “well above forecasts… Outcome confirms (the) view that the Swedish economy is growing broadly and above potential,” Nordea Bank commented.
The Swedish central bank, the Riksbank, said one of the big surprises was the near stagnation of public spending, despite investment linked to the country hosting unprecedented numbers of migrants.
Sweden has taken in more asylum seekers as a proportion of its population than any other country in Europe, as the continent struggles with its biggest migration crisis since World War 2.
“The refugee crisis is not affecting growth yet,” Nordea analyst Torbjorn Isaksson said.

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