Austria's economy to moderately grow in 2026 after prolonged recession, institutes forecast

By Ozan Ergenay

Dec 18 (Reuters) - Austria's economy is expected to moderately grow in 2026, helped by private and public consumption, despite the sluggish global economic environment, two economic institutes said on Thursday.

The WIFO institute expects gross domestic product (GDP) to grow by 1.2% in 2026 and 1.4% in 2027.

Similarly, the IHS institute foresees economic growth of 1.0% next year and 1.1% in 2027.

Both institutes expect economic growth of 0.5% this year.

"Austria's economy grew again for the first time this year in the second half of 2025, and the economic recovery is expected to stabilize in 2026," said Stefan Ederer, one of the authors of the current WIFO forecast.

The IHS said that this growth was driven by private and public consumption as well as a recovery in construction investment, with early indicators suggesting a continuation of this positive trend, albeit at a slower pace.

The WIFO expects inflation to come in at 2.6% in 2026, before slowing to 2.4% in 2027.

The IHS sees inflation at 2.5% for 2026 and 1.9% for 2027.

(Reporting by Ozan Ergenay in Gdansk, Editing by Miranda Murray)