Finland Economic Forecast

Finland Economic Outlook

September 28, 2021

A second reading of national accounts data confirmed that GDP growth accelerated in Q2 and the economy thus returned to pre-pandemic levels. The improvement was largely due to a rebound in private spending and investment as domestic Covid-19 restrictions were eased, although the external sector dragged on overall growth. However, momentum has seemingly slowed in Q3: Although industrial output rebounded in monthly terms in July, economic activity grew at a slightly softer pace. Moreover, retail sales swung back to contraction in the same month. More positively, economic sentiment hit an over 14-year high in August, likely bolstered by the unemployment rate falling to a 16-month low in the same month. Meanwhile, on 9 September, authorities tabled the 2022 budget, which focuses on raising employment levels and reducing carbon emissions, and projects a smaller EUR 6.9 billion deficit.

Finland Economic Growth

The economy is seen expanding at a healthy rate this year and next, supported by recovering private spending and improving investment dynamics. Moreover, healthier foreign demand will support exports as global restrictions are eased. However, lingering uncertainty over the evolution of the pandemic poses a risk to the outlook. FocusEconomics panelists project GDP to grow 2.9% in 2021 and 2.8% in 2022, which is unchanged from last month’s forecast.

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Finland Facts

Value Change Date
Bond Yield0.033.70 %Dec 30
Exchange Rate8.78-0.38 %Jan 01

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