Economy Contracting. Business Cycle Report of August 2008

In Austria, seasonally and working day adjusted GDP grew only by a mere 0.4 percent in real terms quarter-on-quarter in the second quarter of 2008 (+2 percent in year-on-year terms), according to WIFO's flash estimate. This marks the end of the economic upswing. The reversal of the economic trend first became apparent in export and manufacturing. Private consumption is also dampened by declining real incomes. Tourism and construction, on the other hand, expand steadily. While labour market conditions continue to improve compared with a year earlier, the seasonally adjusted figures already show a flattening of employment growth and an increase in unemployment.