Preliminary estimates indicate that real GDP growth decelerated to +3% in 2017 from +4% in 2016, mainly a result of weaker domestic demand. Notably fixed investment growth slowed down to +2.7% in 2017, after it had surged by +11.3% in 2016 due to one-off effects in transport investment and machinery investment. Private consumption growth halved to +3% from +6.1% in 2016, while government consumption eased to +2.8% (+3.9% in 2016). Weaker domestic demand caused import expansion to drop to +3.9% in 2017 (from +9.4% in 2016) while exports remained fairly stable (+2.3%, after +2.5% in 2016) so that the negative contribution of net exports to growth fell to -0.4pp in 2017 (-1.9pp in 2016). Euler Hermes forecasts GDP growth to pick up to +3.6% in 2018 as consumer confidence is currently high and the unemployment rate low (4.3% in November) while exports should benefit from strengthening global demand.
