Luxembourg

The growth outlook remains favorable, but risks are tilted to the downside. Sound economic and fiscal policies together with favorable global conditions in recent years translated into solid growth and a decline in unemployment to record post-crisis lows. Growth prospects remain favorable, but risks are to the downside and include a weaker-than-expected global growth, a disorderly Brexit, changes in international tax rules, and a sharp tightening of global financial conditions. Domestically, rising housing prices pose affordability challenges and could exacerbate the already high household indebtedness.