Economic statistics - 01.11.1993, Side 4

Table 1. Economic and financial indicators
Estimate Proj.
1990 1991 1992 1993 1994
Consumer prices, over year % 7.3 7.2 2.4 4.2 0.7
Treasury balance, %ofGDP -3.2 -3.5 -1.9 -3.3 -2.5
Real value of the fish catch -3.0 -7.5 -0.4 3.4 -7.6
Current acc. balance, % of GDP -2.2 -4.7 -3.1 -1.5 -2.5
Unemployment rate, %, ann.aver. 1.8 1.4 3.0 4.2 5.0
T-bills, 3 months 1 15.2 17.2 10.9 9.5
T-bonds, 5-10 years 1 14.4 15.7 9.0 7.1
1 New issues, nominal annual yield in per cent, weighted average
Source: Central Bank of lceland and National Economic Institute
Table 2. Output and demand
(Volume changes from previous year in per cent)
Forecast
1990 1991 1992 1993 1994
Private consumption -0.4 5.1 -4.7 -3.9 -2.6
Public consumption 4.2 3.2 -0.4 2.0 -1.0
Gross fixed investment 2.8 2.1 -13.3 -9.5 -4.1
National expenditure 0.9 5.0 -5.7 -3.7 -2.5
Exports of goods and services -0.2 -5.8 -1.8 2.0 -3.5
Imports of goods and services 1.0 5.4 -7.9 -10.2 -3.4
Gross domestic production 0.5 1.0 -3.7 0.5 -2.6
Gross national income -0.1 2.4 -4.5 -1.9 -2.6
Source: National Economic Institute
of 1992. The real value of imports fell by 13.7 per cent,
due to a large decline in imports of ships and aircraft,
and a lower exchange rate of the króna. The volume of
exports is expected to fall by 4.9% in the coming year,
mainly due to lower fish catches, whereas export prices
are expected to be largely unchanged. Growth has
mainly been export led in lceland in the past, and this is
unlikely to change in the near future. Therefore, either
export volumes or the terms of trade will have to
improve for sustainable growth to resume.
Inflation, as measured by the consumer price index,
averages 4.2 per cent between 1992 and 1993, and is
estimated to be the same over 1993. The price increas-
es are mainly caused by foreign inflation as well as the
devaluation of the króna by 6 per cent in November
1992 and by 7.5 per cent in June 1993. Due to the
conditions on the labour market the underlying inflation
is much lower. The prospects are for a standstill
between October and March and an increase of below
1 per cent over 1994.
An interbank foreign exchange market was estab-
lished this year, as mentioned in the May 1993 issue of
Economic Statistics. The policy of stable exchange rate
is unchanged, but the exchange rate of the króna is
allowed to fluctuate within a limit of ±2% per cent from a
central rate. In June, however, the króna was devalued
by 7.5 per cent, in light of a foreseeable decline in
export earnings and the difficult position of the fisheries
as a result of a cut in fishing quotas for the fishing year
that began on 1 September. Since then the króna has
Central Bank net weekly purchases
on foreign exchange interbank market
Million krónur
800
600
400
200
O
-200
-400
-600
-800