Vienna, Sep 13 (IANS): The Austrian National Bank (OeNB) on Friday lowered the forecast for Austria's gross domestic product (GDP) this year from a 0.3 per cent growth to a 0.7 per cent contraction, citing an industrial recession and weak consumer spending.

With Austria's GDP having contracted by 0.8 per cent in 2023, the central European nation is now on track for its second consecutive year of economic recession.

The OeNB also lowered its forecast for Austria's GDP growth in 2025 from 1.8 percent to 1 per cent, according to a statement from the bank, Xinhua news agency reported.

The bank noted that energy-intensive industries and construction-related sectors are particularly impacted by weak demand.

The OeNB projected Austria's inflation rate to decline to 2.9 per cent this year and 2.3 percent in 2025, down from a peak of 7.7 per cent in 2023, attributing the drop to falling producer prices and weak demand.

The bank also projected Austria's unemployment rate to rise from 6.4 per cent in 2023 to 7.1 per cent in 2024 and to remain above 7 per cent over the next two years, citing the sluggish economy.