Finland: GDP contracts slightly in Q1
June 4, 2015
According to official data released by Statistics Finland on 4 June, the Finnish economy declined a seasonally-adjusted 0.1% in Q1 2015 over the previous quarter, which represented the lowest reading since Q1 2014. The print was level with the revised 0.1% contraction recorded in Q4 (previously reported: -0.2% quarter-on-quarter). In annual terms, GDP registered flat growth in Q1 (Q4: +0.1% year-on-year).
The quarterly decline was mainly driven by a deterioration in the external sector, offsetting an improvement in domestic demand. Private consumption rebounded to a 1.0% expansion over the previous quarter, contrasting the 0.2% contraction that was tallied in Q4 and marking the fastest growth in 10 quarters. Government spending was unchanged over the previous quarter (Q4: -0.4% qoq). Fixed investment improved in Q1, although it still remained in contractionary territory, falling 0.3% on a quarterly basis (Q4: -3.2% qoq).
On the external front, exports fell a seasonally-adjusted 1.1% in Q1, which was below the revised 0.2% contraction observed in Q4. Imports rebounded 2.4% in Q1, contrasting Q4’s 1.9% drop. As a result, the external sector’s net contribution to GDP growth swung from plus 0.7 percentage points in Q4 to minus 1.3 percentage points in Q1.
Author: Robert Hill, Economist