The slackening of the business cycle in the USA, the fallout from higher oil prices, and a restrictive budgetary stance are
set to dampen economic growth in 2001. Following the strong upturn in 2000 (+3.3 percent), demand and output in Austria are
expected to expand by a more moderate 2.6 percent in 2001. The slower pace of activity will still allow unemployment to decline
further, albeit by a narrower margin. Inflation should decelerate markedly if the assumptions of a fall in oil prices and
a weaker dollar exchange rate are confirmed. With energy prices no longer exerting upward pressure, the annual inflation rate
should abate to 1.5 percent in 2001.
Keywords:Temporary Slowdown in Economic Growth. Economic Outlook for 2001 and 2002
Forschungsbereich:Makroökonomie und öffentliche Finanzen