However, we expect them to fall this year due to rising long-term interest rates, which will entail capital losses on pension funds’ hedging instruments in particular. In recent years, Denmark has received the equivalent of 3 per cent of GDP in annual return on its net foreign assets; this increases consumption opportunities correspondingly.
The current account of the balance of payments reflects the difference between savings and investment in the economy overall. The positive trend since 1990 is attributable to a structural increase in the propensity to save rather than lower investment. True, the investment ratio is somewhat low at present, but in view of the current cyclical position it is not unusually low.