Statec, the grand duchy’s statistics bureau, has published the first GDP estimates for the second quarter of 2023 on Thursday 14 September, which came with significant revisions for previous quarters. The GDP volume change for Q2 2023 indicates a mild contraction of -0.1% quarter-over-quarter and a more concerning -1.7% year-over-year. This marks the third quarterly downturn in the past six quarters, showcasing a roller-coaster trend in economic performance.
Annual GDP adjustments have been significant. Q1 2023 was revised to show a -1.7% change, a steep drop from its initial -0.4% estimate. The fourth quarter of 2022 shifted slightly from -2.2% to -2.3%, while Q3 2022 was notably downgraded from an optimistic +3.8% to just +2.1%. Following traditional procedures, annual accounts for 2019, 2020 and 2021 were adjusted. Also, 2022’s annual GDP change was revised downward to 1.4%, compared to the earlier March 2023 projection of 1.6%.
Sectoral changes in GDP reveal uneven impacts. The financial and insurance sector experienced only a modest 0.1% decline. However, several other sectors faced substantial declines: trade, transport, accommodation and food services plummeted by 2.5%; business services and rentals fell by 0.4%; real estate activities dropped by 0.3%; industry, including energy and water distribution, slumped by 3.4%; and construction contracted by 3.3%. In contrast, public administration, education and health were the lone sectors to register slight growth, at 0.3%.
From an expenditure perspective, household consumption held steady at a flat 0.0%. Public administration, however, increased its spending by 1.4%. Gross capital formation, a critical gauge for economic investment, saw a significant drop of 4.7%. On the trade front, both exports and imports declined, contracting by 0.6% and 1.8%, respectively.