Economists: we’re not heading for recession

For the first time in months economists are talking domestic growth, not doom and gloom

Hugger's promising career ended in 2009 when he endured a serious eye injury (photo: iStock)
February 14th, 2012 4:49 pm| by admin
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With cautious optimism, top economists have declared Denmark safely out of the red zone and back on track for slow and steady growth.

Months of uncertainty over the fate of the Eurozone are fading now that Europe’s leaders have hammered out a plan for dealing with the debt crisis. And that’s “unequivocally good news for the world’s economy, to which we here in Denmark are so sensitive”, Hans Jørgen Whitta-Jacobsen, the leading advisor to the national economic council Det Økonomiske Råd, told financial daily Børsen.

Whitta-Jacobsen pointed to the stabilisation of the euro and the strong demand for Danish state bonds as two reasons why Denmark is out of the danger zone for falling into a new recession.

His observation was shared by top economists at two of the countryÂ’s biggest banks.

“The global trends are, for the moment, a whole lot more positive than what we feared just a month ago,” said Danske Bank senior economist, Steen Bocian.

“After a period of lots of angst, we’re back to where we started. We’re in a slow recovery with weak growth rates,” Jes Asmussen, a senior economist at Handelsbanken bank, added.

Job market experts are also noting continued positive growth, despite media focus on ‘perma-crisis’.

“The job growth is surprisingly stable, and that was also the case last autumn,” Kaare Danielsen, the president of Jobindex, DenmarkÂ’s largest job search portal, told Ritzau news service. 

“If you only read the newspapers, you would get very nervous,” Danielsen said, adding that the number of job announcements on Jobindex at the beginning of 2012 is actually up from early 2011.

Jyske Bank senior economist Niels Rønholt has also noted life signs in consumer activity, which will be key to revving the economy out of its rut.

“Sales of consumer products aren’t falling any longer. And, recently, car sales are also up,” Rønholdt told Børsen. “When you put those two things together, it looks like private consumption is going to rise for the first time in five quarters.”

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