Luxembourg’s GDP Shows Modest Growth in Q2, but Construction Faces Steep Decline

Luxembourg’s economy showed signs of resilience in the second quarter of 2025, according to fresh figures from Statec. Gross Domestic Product (GDP) rose by 0.6% between April and June, marking a slight rebound after a challenging start to the year. However, compared to the same period in 2024, GDP slipped by 0.2%, reflecting lingering economic headwinds.

Statec also revised its previous estimates: GDP growth for 2023 is now calculated at +0.1% (instead of the earlier -0.7%), while for 2024 the figure was adjusted to +0.4% (down from 1%).

Construction Hit Hard Again
The construction sector, which briefly recovered in the first quarter with a 5% rebound, plunged once again, posting a 3.6% drop from the previous quarter and 2.3% lower than a year earlier. This volatility highlights the ongoing fragility in one of Luxembourg’s key industries.
By contrast, real estate activities inched upward (+0.9% quarter-on-quarter and +1.8% year-on-year), offering a slight counterbalance to the construction slump.

Industry Bounces Back, Households Spend More
Industry registered a notable 2% rebound compared to Q1, after a sharp -14.2% contraction earlier this year. Still, on a yearly basis, the sector remains down 7.2%.

Household consumption provided another source of stability, with Luxembourgers spending more on health services, dining, and food products. Spending on vehicle-related goods and real estate administration services, however, fell.
The information and communication sector also performed strongly, helping lift overall economic momentum, even as trade and catering registered declines.

While Luxembourg’s economy managed to edge upward in Q2, the continued struggles in construction and weak yearly comparisons underline an uneven recovery. The next quarters will be key to determining whether recent gains in industry and household spending can offset structural weaknesses in the broader economy.

Leran More : Économie luxembourgeoise: le PIB augmente tandis que la construction chute de 3,6% - L'essentiel
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