The Icelandic economy will continue to grow at a very respectable rate until at least 2019, at which time the current economic boom will have lasted nine full years, making it one of the longest and most robust periods of growth in Icelandic economic history. Growth is slowing down, however, as this year the economy is expected to grow by 5.3%, 2.7% in 2018 and 2.3% in 2019.
Read more: Report: Icelandic economic growth tops all but one OECD country in 2016: GDP grew 7.2%
According to a revised economic forecast prepared by Arion Bank, one of the three large domestic banks, the economic growth in 2017-19 will be slightly slower than previous forecasts had projected. The main reason for the revision is a smaller increase in investments, especially by utilities and in industry than previously projected.
The forecasts envisions a slight strengthening of the Icelandic currency, the Króna, in 2017, but a weakening in 2018. The strengthening of the currency has helped fuel private consumption by making imports more affordable, but at the same time the stronger Króna will slow down the growth of the economy, as it makes Icelandic exports more expensive on foreign markets as well as making travel to Iceland more expensive for foreign visitors. A stronger Króna has been identified as a major reason for a slowdown in some parts of the tourism industry.
The Icelandic economy will continue to grow at a very respectable rate until at least 2019, at which time the current economic boom will have lasted nine full years, making it one of the longest and most robust periods of growth in Icelandic economic history. Growth is slowing down, however, as this year the economy is expected to grow by 5.3%, 2.7% in 2018 and 2.3% in 2019.
Read more: Report: Icelandic economic growth tops all but one OECD country in 2016: GDP grew 7.2%
According to a revised economic forecast prepared by Arion Bank, one of the three large domestic banks, the economic growth in 2017-19 will be slightly slower than previous forecasts had projected. The main reason for the revision is a smaller increase in investments, especially by utilities and in industry than previously projected.
The forecasts envisions a slight strengthening of the Icelandic currency, the Króna, in 2017, but a weakening in 2018. The strengthening of the currency has helped fuel private consumption by making imports more affordable, but at the same time the stronger Króna will slow down the growth of the economy, as it makes Icelandic exports more expensive on foreign markets as well as making travel to Iceland more expensive for foreign visitors. A stronger Króna has been identified as a major reason for a slowdown in some parts of the tourism industry.
