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'Denmark’s housing crisis is set to deepen as private debt burdens remain high, property values sink and the job market struggles, Moody’s Investors Service said. '

'House prices, which have plunged 25 percent since their peak in 2007, will probably fall another 5.5 percent this year, the government said last month. Property values sank an annual 8.6 percent in March, Statistics Denmark said May 31. Unemployment will rise to 7.6 percent this year from 7.4 percent in 2011, the Organization for Economic Cooperation and Development said last month.

The cocktail of declining property values and rising joblessness has left households vulnerable, according to Moody’s. The rating company estimates private debt burdens reached 142 percent of gross domestic product at the end of 2010, twice the European Union average of 79 percent. '

'The country has emerged as a haven thanks to its fiscal discipline. The government of Prime Minister Helle Thorning- Schmidt in May cut the budget deficit target to 1.7 percent of gross domestic product for next year and 3.8 percent for 2012. That compares with a 3.6 percent average deficit in the European Union this year and 3.3 percent in 2013, the European Commission said May 11. Denmark also boasts a current account surplus. '
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