Economy expands more than initially estimated in Q3 2025

Data revised up from flash release: A second release showed that Austria's GDP grew 0.4% in seasonally adjusted quarter-on-quarter terms in Q3, following an upwardly revised flat reading in the prior quarter. Q3’s reading was stronger than the 0.1% expansion from the flash release and the highest so far this year, rising above the euro area average for the first time since Q2 2022. On a year-on-year basis, GDP increased 1.0% in Q3, following 0.5% growth in the previous quarter.

Public spending fuels improvement: Compared with the prior quarter's data, the reading for public spending in Q3 improved (+0.7% on a seasonally adjusted quarter-on-quarter basis vs +0.3% in Q2). In contrast, readings worsened for private consumption (-0.3% vs +0.3% in Q2), fixed investment (-0.1% vs +1.1% in Q2), exports of goods and services (-1.6% vs +0.2% in Q2) and imports of goods and services (-0.5% vs +1.6% in Q2).

Panelist insight: EIU analysts said: “In 2026 we expect growth to pick up to just under 1%, reflecting an improving external backdrop, stronger economic growth in the euro zone, falling energy prices and the continued strength of Austria's international tourism sector. The main risk to our growth outlook is a worse than expected performance of the German industrial sector.” UniCredit’s Walter Pudschedl commented on the outlook: “The strength of the recovery of the domestic economy in 2026 will depend decisively on the development of domestic demand. On the one hand, the aftermath of the key interest rate cuts should have a positive effect on investment activity. On the other hand, the decline in inflation should contribute to a slow decline in the propensity to save and be able to give private consumption a little more momentum. Foreign trade is expected to continue to weigh on the economy in Austria at least in 2026. However, the negative effect should gradually decrease.”

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