Economic situation remains favourable

The picture of the economic situation at the end of December is very similar to that at the end of November. The heart of the indicators in the Business Cycle Tracer is again located in the high economic growth stage. All indicators in the Tracer are performing better than their long-term average.

At 4.2 percent, economic growth in the third quarter was the highest in more than seven years. Growth was spurred on by gas production. After adjustment for seasonal effects, GDP volume grew by 1.8 percent compared with the second quarter of 2007.The quarter-on-quarter growth has not been this high for over ten years.

Consumption growth remained high. Household spending rose by 2.8 percent in October, compared with the same month one year previously. The growth in manufacturing production slowed down. After correction for working days, the volume of exports of goods was up more than 8 percent on October 2006.

Consumer confidence remained unchanged in December. Manufacturers remained optimistic. The number of the business service providers expecting to receive more orders and to generate a higher turnover in the fourth quarter of this year exceeds those anticipating a decrease.

The capital market interest rate stood at 4.2 percent in November, 0.2 of a percentage point down on October. Inflation increased to 1.9 percent. Selling prices in manufacturing industry rose by 8.7 percent on November 2006, the most substantial increase for seven years.

In the period September-November, seasonally adjusted unemployment decreased further. The number of job vacancies reached a record level in the third quarter. The number of hours worked in temp jobs also rose in the third quarter, but the growth rate somewhat decelerated. In the second quarter of 2007, job growth continued further.

Gross domestic product (GDP)