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Iceland’s economy expanded 2.3% year-on-year in Q4 2024, accelerating from a revised 0.4% in Q3 and marking the fastest expansion since Q4 2023. Growth was driven by a surge in fixed investments (15.6% vs. 1.5%), particularly in business sectors and residential construction. Meanwhile, household consumption (0.8% vs. 1.5%) and government spending (2.1% vs. 2.9%) slowed. Net trade also weighed on GDP, with imports surging 10.5% (vs. -2.2%) while exports rose at a softer 1.4% (-2%). On a seasonally adjusted quarterly basis, GDP contracted 1.4%, unchanged from Q3, and remaining at its sharpest contraction since Q3 2023. For the full year, the economy expanded 0.6%, sharply down from 5.6% in 2023.