Finland: Economy slows in Q4
March 1, 2017
The Finnish economy stagnated in Q4 compared to the previous quarter in seasonally-adjusted terms, which contrasted Q3’s 0.6% expansion, according to preliminary data released by Statistics Finland on 1 March. In annual terms, GDP growth slowed to 1.3% (Q3: +1.9%). According to full year data released on 16 March, GDP growth was 1.4% in 2016 (2015: +0.3%).
The slowdown was mainly caused by total consumption swinging into contractionary territory. Government consumption fell deeper into contractionary territory, falling 0.6% (Q3: -0.1% quarter-on-quarter), while private consumption ground to a halt, growing just 0.1% (Q3: +0.4% qoq). Total consumption’s negative contribution offset a strong acceleration in fixed investment, which grew 3.0% qoq following 0.4% growth in Q3.
On the external front, the external sector’s net contribution fell back into negative territory, clipping 0.5 percentage points off growth (Q3: +0.2 percentage points). The fall was mostly driven by a pick-up in import growth (Q4: +1.9% qoq; Q3: -0.4% qoq), which was greater than the pickup in export growth (Q4: +0.6%; Q3: 0.0%).
Author: Christopher Mc Innes, Economist