IMF Staff Country Reports

Iceland: Fourth Post-Program Monitoring Discussions

Publication Date:

July 10, 2014

Electronic Access:

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Summary:

This paper discusses Iceland’s Fourth Post-Program Monitoring Discussions. Iceland’s economy has grown strongly on the back of booming tourism. Real GDP grew 3.3 percent in 2013, despite a drop in investment spending. Net exports were the primary driver. High frequency indicators suggest strong net exports—including steady growth in off-season tourism—have continued in Q1 2014, along with rising private consumption. Inflation has fallen below the Central Bank of Iceland’s 2.5 percent target but long-term inflation expectations remain noticeably above this level. The government’s medium-term fiscal objectives deserve support, but further effort is needed to achieve them.

Series:

Country Report No. 2014/194

Subject:

Asset and liability management Balance of payments Banking Capital controls Debt relief External debt Foreign exchange Public debt