Austria Sees Economic Contraction in Q2

The contraction was mainly due to lackluster performances of the trade and industry sectors, which shrank by 6.7 percent and 2 percent year on year, respectively, according to a press release from the institution.

Director-General of Statistics Austria Tobias Thomas said Austria's economic growth has weakened since the second half of 2022, and its economy "weakens and shrinks in spring 2023 for the first time in eight quarters."

While Austria's inflation has steadily declined to 7.5 percent in August from a peak of over 10 percent in late 2022, it remained high compared to other countries in the eurozone, Statistics Austria said.

The Austrian Institute of Economic Research (WIFO) on Thursday reported continued decline in business assessments of the country's economy, with its Business Climate Index dropping to minus 8.9 points in August from minus 5.2 points in the previous month.

"Assessments of the current situation declined across all sectors and were deeply in negative territory, especially in manufacturing," the institute said in a statement. "Economic expectations also deteriorated further, signaling a pessimistic economic outlook."

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