WIIW The Vienna Institute for International Economic Studies - Wiener Institut für Internationale Wirtschaftsvergleiche

The economy expanded by 3.4% in 2023, driven by increased domestic and external demand. Public finances remain robust, and efforts toward fiscal consolidation will continue. However, imbalances on the labour market are intensifying, posing a risk to growth as emigration rates surge and as labour and skills shortages loom. While inflation is expected to moderate, seasonal challenges persist. The current account deficit has nearly bottomed out and will likely remain low due to sustained external demand. Positive trends in tourism and foreign direct investment are set to continue to fuel the momentum, which is expected to result in growth of 3.5% in the medium term.