Denmark’s bankruptcy rate has plummeted to its lowest level since late 2021, with only 178 active companies declaring bankruptcy in June. This figure represents a 25 percent decrease compared to the previous month, signaling a positive trend for the Danish economy.

Economists attribute this decline to factors such as curbed inflation, falling interest rates, and peak employment levels. These conditions are providing much-needed support to businesses that may be experiencing customer shortages.

The average number of bankruptcies in the first half of the year was 203 per month, closely aligning with the historical average of 208 bankruptcies. Increased consumer spending, particularly in the retail sector and the experience industry, is also contributing to the favorable economic climate.

Looking ahead, economists remain cautiously optimistic, projecting that bankruptcies will remain around 200 per month in the coming years. However, the ongoing trade war with the United States is identified as a potential risk factor that could negatively impact the Danish economy.

While there is no immediate evidence that the trade conflict with the U.S. has triggered a surge in bankruptcies, an escalation of the situation could weaken growth and strain many companies. Despite this concern, there is still hope for a manageable trade agreement to be reached, especially for Danish companies heavily reliant on exports to the U.S.