Oil Price Shock Halts the Economic Recovery – Industrial Production Rises Despite the Trend in Orders

According to WIFO's Flash Estimate, Austria's gross domestic product stagnated in the second quarter of 2026 compared with the previous quarter (±0.0 percent). The oil price shock triggered by the war in Iran thus halted the modest economic recovery observed since early 2025. Although key leading indicators improved noticeably in July, the demand base remained narrow: the manufacturing sector expanded its output at a rate not seen since mid-2022, but new orders continued to decline.