## Denmark: 2008 Article IV Consultation-Staff Report; Staff Statement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Denmark

_IMF Staff Country Reports, December 29, 2008_

## Source details

**Canonical URL:** [Denmark: 2008 Article IV Consultation-Staff Report; Staff Statement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Denmark](https://www.imf.org/en/publications/cr/issues/2016/12/31/denmark-2008-article-iv-consultation-staff-report-staff-statement-public-information-notice-22563)

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## Bibliographic details
- Published: December 29, 2008
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781451811230.002

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### Executive summary and key findings
- The global liquidity crisis put the financial sector under severe stress.
- Most banks have weathered the crisis well owing to strong initial positions and supportive policies.
- The crisis accelerated a downturn that had begun in 2007 and tilted the balance of macroeconomic risk toward recession.
- The macroeconomic policy mix is appropriate:
  - Higher interest rates to support the exchange rate peg.
  - An expansionary budget to add a countercyclical thrust to the strong stabilizing effect of Denmark’s automatic stabilizers.

### Detailed findings and thematic points
- Financial sector:
  - Severe stress from the global liquidity crisis.
  - Most banks remained resilient due to strong initial positions and supportive policies.
- Macroeconomic outlook:
  - Downturn accelerated by the crisis; original downturn began in 2007.
  - Balance of macroeconomic risk tilted toward recession.
- Policy assessment:
  - Monetary policy: higher interest rates to defend the exchange rate peg.
  - Fiscal policy: expansionary budget recommended to provide countercyclical support alongside automatic stabilizers.

### Subjects and keywords (as provided)
- Subjects: Fiscal policy, Fiscal stance, Income, Labor, Labor markets, National accounts, Wages
- Keywords: baseline scenario, CR, Fiscal stance, Global, growth, growth prospect, IMF staff estimate, Income, ISCR, Labor markets, maturing mortgage bond, staff appraisal, Wages

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_Source: https://www.imf.org/en/publications/cr/issues/2016/12/31/denmark-2008-article-iv-consultation-staff-report-staff-statement-public-information-notice-22563_