Analysts at Danske Bank A/S predict Danish gross domestic product will rise 1.8% in 2024, according to the latest Nordic outlook published on Tuesday. That compares with a previous prediction of 2.1% growth, partly as 2023 figures had been revised up.

The nation’s flourishing drugmaking industry, mostly known for Novo’s obesity drugs and Bavarian Nordic A/S’s mpox vaccine, has been responsible for much of its output growth in recent years, triggering concerns it would mask weaknesses elsewhere in the economy.

While Novo will remain the key engine of the country’s economy, Danske analysts hinted that growth may be supported more widely than previously assumed, saying there are “indications that the broader Danish economy has been performing quite decently” and that other sectors “have made progress too and look likely to continue.”

“One reason may be Danish consumers not being hit quite so hard as many others during the period of high inflation,” the report said, adding that real wage growth and a well-performing housing and labor market provide a “solid basis for rising consumption.”

Danske also slightly reduced its expectations on Swedish growth in 2024, though it remains among the most upbeat forecasters, with a 1.2% expansion penciled in for this year.

“The Swedish economy performed slightly weaker during the first half of the year than we had previously assessed, though not to an extent that significantly shakes our optimistic view,” Danske said in the report. “Looking ahead, households can look forward to both much lower interest costs and lower income taxes, which will give real incomes a boost.”

For Norway, too, the bank lowered its forecast for this year’s growth excluding the offshore petroleum and shipping sectors, while expecting an upturn heading into next year on the back of higher household purchasing power. It sees the Norwegian krone remaining relatively weak, affected by higher global risk aversion on recessionary fears.

Danske Bank’s Nordic GDP Forecasts: