Danish government likely to tighten fiscal policy in 2016

Denmark’s budget deficit is likely to be larger in 2016 as compared to 2015, according to Danske Bank. This is mainly because one-off revenues from the conversion of capital pensions are not present. The Danish government is likely to fulfil its plan of tightening its fiscal policy in 2016 due to diminished public investment.

Nevertheless, timing investments has been challenging to manage, whereas revenues are quite sensitive to fluctuations in financial market and oil price. Hence, the uncertainty level in 2016 is considerable, noted Danske Bank.