Global trade strengthened further in the early months of 2010. On the back of buoyant demand from Asia, a recovery in the USA and a lower euro exchange rate, euro area exports should advance at a healthy pace. With internal demand still sluggish, the cyclical upswing in the euro area will nevertheless remain muted for some time. Major risks derive from macro-economic imbalances and financial market volatility. For Austria, WIFO expects real GDP to grow by 1.2 percent in 2010 and 1.6 percent in 2011, mainly driven by exports and private consumption. Employment is projected to increase by 0.5 percent each year.