According to the latest projections of Statistics Iceland the GDP of Iceland will grow by 4.3% in 2016, thanks to strong private consumption and investment. Growth is expected to remain strong for the foreseeable future, but slow down slightly. GDP is expected to be 3.5% in 2017, and then 3% per annum for 2018-2021.
Read more: 40% of all new employees in the tourism industry will come from abroad in 2016 and 2017
Growth in 2016 and 2017 is fuelled by growing private consumption and strong investment. The boom in tourism is responsible for Icelandic export growth in the coming years, allowing Statistics Iceland to project a trade surplus for the entire forecast period.
Other economic indicators are similarly positive. The wage index in April 2016 was 13.4% higher than in April 2015. According to this, real wages in Iceland have risen by 11.6% over the past year. At the same time unemployment remains low. According to the Icelandic labour force survey the labour participation rate was 84.1% in April, which is very high in international comparison, and seasonally adjusted unemployment was only 3.2%.
Read more: Iceland has the second highest quality of life among OECD countries
Inflation also remains well within the Central Bank’s target rate. Statistics Iceland recently revealed that inflation remains low, with consumer prices rising only 0.42% between months, despite rising wages. The Consumer Price Index in May 2016 was 1.7% higher than in May 2015.
According to the latest projections of Statistics Iceland the GDP of Iceland will grow by 4.3% in 2016, thanks to strong private consumption and investment. Growth is expected to remain strong for the foreseeable future, but slow down slightly. GDP is expected to be 3.5% in 2017, and then 3% per annum for 2018-2021.
Read more: 40% of all new employees in the tourism industry will come from abroad in 2016 and 2017
Growth in 2016 and 2017 is fuelled by growing private consumption and strong investment. The boom in tourism is responsible for Icelandic export growth in the coming years, allowing Statistics Iceland to project a trade surplus for the entire forecast period.
Other economic indicators are similarly positive. The wage index in April 2016 was 13.4% higher than in April 2015. According to this, real wages in Iceland have risen by 11.6% over the past year. At the same time unemployment remains low. According to the Icelandic labour force survey the labour participation rate was 84.1% in April, which is very high in international comparison, and seasonally adjusted unemployment was only 3.2%.
Read more: Iceland has the second highest quality of life among OECD countries
Inflation also remains well within the Central Bank’s target rate. Statistics Iceland recently revealed that inflation remains low, with consumer prices rising only 0.42% between months, despite rising wages. The Consumer Price Index in May 2016 was 1.7% higher than in May 2015.
