The National Bank of Denmark forecasts that the Danish economy will grow 4.0 percent in 2026, driven mainly by an extraordinary increase in pharmaceutical production abroad. Growth is projected to moderate to 2.3 percent in 2027 and 2.0 percent in 2028, supported by exports, higher public demand and rising real incomes, without signs of increased wage or price pressure. Higher energy prices linked to the war in the Middle East are expected to lift inflation over the winter, with annual inflation projected at 1.7 percent in 2026, 2.4 percent in 2027 and 2.1 percent in 2028. Although the broader outlook remains balanced, with high employment, low unemployment and moderate wage growth, limited spare capacity raises the risk that additional demand could increase price and wage pressures. The central bank recommends that the government refrain from boosting demand beyond the measures set out in August when presenting its Finance Bill in October. It also calls for caution in using the full fiscal scope in coming years, citing uncertainty over the domestic impact of defense procurement and the potential pressure from additional government initiatives.
2026-09-23National Bank of Denmark
National Bank of Denmark forecasts 4 percent growth in 2026 and urges fiscal caution
The National Bank of Denmark forecasts GDP growth of 4.0 percent in 2026, largely because of increased pharmaceutical production abroad, before growth slows to 2.3 percent in 2027 and 2.0 percent in 2028. With limited spare capacity and inflation expected to rise over the winter, it recommends no further demand stimulus in the October Finance Bill and caution in using future fiscal scope.