Economy stagnates in Q4 2025

Economy ends 2025 on a softer footing: Austria's GDP flatlined on a seasonally adjusted quarter-on-quarter basis in Q4, revised down from the initial flash estimate of 0.2% growth and slowing from Q4’s 0.3% expansion. Q4's reading was the weakest since Q3 2024. On a year-on-year basis, GDP grew 0.7% in Q4, following 1.1% growth in the prior quarter. In 2025 as a whole, GDP grew 0.7%, recovering from 2024’s 0.8% fall and marking a three-year high, lifted by rebounds in fixed investment and exports.

Domestic demand weakens in Q4: Compared with the previous quarter's data, readings in Q4 worsened for government consumption (-0.4% in seasonally adjusted quarter-on-quarter terms vs +0.6% in Q3), fixed investment (-2.1% vs +1.0% in Q3), exports of goods and services (-0.1% vs +1.5% in Q3) and imports of goods and services (-0.7% vs +0.7% in Q3). In contrast, the reading for private consumption improved in Q4 (+0.2% vs -0.6% in Q3).

Panelist insight: EIU analysts said: “We forecast that real GDP growth will accelerate only moderately [in 2026]. Faster growth will be supported by an increase in private consumption in the wake of recent monetary loosening, alongside stronger demand in the German economy amid lower interest rates and inflation, supporting demand for exports. Austria's growth outlook is closely tied to Germany's industrial performance. This is due to the two countries' integrated industrial sectors, whereby a good German industrial performance lifts Austria's manufacturing exports.”

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