2004 OECD Economic Outlook, Volume 2004 Issue 1

image of OECD Economic Outlook, Volume 2004 Issue 1

OECD's June 2004 assessment of economic developments and prospects.  In addition to the regular economic assessments and statistical information, this issue includes articles examining whether housing and mortgage market arrangements explain different degrees of economic resilience shown by OECD economies, through what mechanisms the US external deficit could adjust, to what extent stock market gyrations and one-off measures distort traditional measures of the fiscal stance, and how structural reform could enhance income convergence in Central European countries.

English Also available in: French, German


A steady upswing is taking place. Output growth has picked up to its potential rate, driven by household spending and a recovery in exports. External demand is projected to continue to provide stimulus and will be aided by a rebound in business investment. Inflation is below target, although there is a small risk that this year’s wage negotiations may put upward pressure on prices. Fiscal expansion is not warranted; rather, further increases in the structural surplus would be appropriate in order to prepare for looming age-related spending pressures. The Riksbank should also remain cautious, despite the recent surprisingly weak inflation outcomes, maintaining the focus on prospects over a two year horizon and gradually withdrawing monetary stimulus in anticipation of the closing of the output gap in 2005. Reductions in working hours should be avoided...

English Also available in: French

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