Much as expected, demand and output in Austria remained firm throughout 1990. The forecast for annual growth of real GDP is maintained at 4½ percent. Also, projections for other major variables are broadly confirmed by recent developments. Consumer price inflation will likely average 3¼ percent, unemployment is rising to almost 5½ percent of the dependent labour force and the current account remains in small surplus. Forward looking indicators like the inflow of orders to industry and survey data on business confidence signal a weakening of activity in 1991, in line with the international trend. Domestic demand will expand at a slower pace. The once-and-for-all boost to net disposable incomes and private consumption from the tax reform is levelling off. However, settlements in the autumn wage round broadly protect real wage gains against the impact of rising inflation and households may be ready to reduce their saving in view of the still encouraging prospects for income and employment. With output close to capacity limits and profits at record levels there are strong incentives for firms to step up capital spending. Yet, the danger of a recession abroad, the Gulf crisis and spreading fragility in financial markets have recently deteriorated the investment climate. WIFO survey results show clearly that entrepreneurs are turning more cautious in judging the business outlook. On the other hand, activity in the construction industry is gaining new momentum. In all, the forecast for 1991 GDP growth is slightly revised downwards to 3¼ percent.