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Economy in Brief

 Denmark's GDP Third Quarter Growth Slowed by Decline in the Foreign Trade Balance
by Louise Curley November 29, 2004

Gross domestic product in Denmark rose a negligible 0.04% in the third quarter. Private consumption rose almost 1% but public consumption fell by 0.6%. Gross fixed capital spending rose 3.6% and a swing in inventory change from a liquidation of 1,051 million 1995 Krone to an accumulation of 3,003 million also added a good boost to output. But the foreign trade sector offset almost all the gains on the domestic sector. The impact of net exports in the total gross national product is illustrated in the first chart.

Although Denmark is not in the Euro zone, its currency, the krone has moved with the euro against the dollar as can be seen in the second chart. Part of the decline of 1,7% in the exports of goods and services from the second to the third quarter was due to the rising krone. At the same time, the rising krone stimulated imports of goods and service, which rose by 3.4%. However, rising prices of oil also contributed to the rise in imports. The combination of lower exports and higher imports led to a decline of 7,303 million 1995 krone in the balance of trade in goods and services from 10,224 million 1995 Krone in the second quarter to 2,921 million in the third quarter.

Millions of 1995 Krone Q3 04 Q2 O4 Q1 04 Q4 03 Q3/Q2 %  2003    2002    2001   
Gross domestic product 303,195 303,080 301,959 298,778 0.04 1,188,639 1,186,639 1,170,719
  Private consumption 144,509 143,088 142,118 141,688 0.99. 556,054 551,375 547,961
  Public consumption 75,864 76,327 75,186 76,351 -0.61 305,077 301,922 295,601
  Gross fixed capital spending 76,564 73,908 72,464 75,025 3.59 285,800 285,554 295,101
  Inventory change 3,003 -1,051 1,888 -2,433 4,054* -4,225 868 1,162
  Exports of goods and services 147,319 149,838 142,218 140,475 -1.68 563,819 563,885 538,315
  Imports of goods and services 144,398 139,614 131,977 131,560 3.43 517,886 520,977 485.662
  Net exports of goods and services 2,921 10,224 10,241 8.915 -7,303* 45,933 42,908 52,653
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