Downturn in Business Activity

Since the middle of the year the downturn in the Austrian business cycle has become clearly visible. Exports and industrial output are receding under the impact of the recession in Europe and the effective revaluation of the schilling. Domestic demand has a stabilizing influence benefitting particularly retail trade, construction and the tourism industry. The current account remains in equilibrum while the rate of inflation has edged up to 4 percent in October.