Economic Upswing Gaining Strength

The Austrian economy grew by 3 percent in volume year-on-year in the second quarter of 2006, according to WIFO's latest flash estimate. Goods exports continued to gain momentum, and investment activity also strengthened. There is no indication of a pick-up in private consumption and housing construction, however. Sentiment among companies in the manufacturing sector is currently as optimistic as it was last in 2000. However, the pace of economic expansion is expected to slow at the beginning of 2007 at the latest, given that the international framework conditions will deteriorate and carry-forward effects due to the VAT hike in German will come to an end.Konjunkturbericht Oesterreich