In the latest revision of the short-term forecast real GDP growth has been estimated at 3½ percent for 1990 and 3 percent in 1991, up by half a percentage point respectively from the previous figures three months ago. The upward correction is motivated by positive repercussions the coming German monetary union is expected to have on the Austrian economy. Domestic demand in Austria is expected to decelerate only little from the pace obtaining in the past two years. Private consumption will lose momentum as the effects of the 1989 tax reform wear off, but may still grow at a rate of nearly 3 percent in 1991. On the other hand, the tax cuts will continue to boost investment in machinery and equipment, particularly in manufacturing industry. Construction in 1990 is damped by a temporary fall in residential building. Next year, growth may reaccelerate to 3 percent as new large-scale projects are in the offing. The upward revision of GDP growth is accompanied by a better labour market outlook. The number of workers and employees will rise even more in 1990 (+55,000) than last year; flexibility of labour supply is secured by foreigners and part-time job seekers. The number of registered unemployed, however, remains unchanged. Consumer price inflation will exceed 3 percent both in 1990 and 1991. The monetary union will accelerate inflation in Germany and lead to higher import prices in Austria. Domestic components will attenuate the upward drift of the price level. In spite of lively domestic demand the Austrian current account will deteriorate only marginally. The forecast is for a small deficit of some 2 bill. AS both this year and next.