Finland GDP


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.

The Central Bank expects the economy to contract 0.1% in 2015 and to expand 1.0% in 2016. FocusEconomics Consensus Forecast panelists are more optimistic than the Central Bank in its forecast and expect the economy to expand 0.4% in 2015, which is down 0.1 percentage points from last month’s projection. For 2016, the panel sees GDP expanding 1.3%.

Author:, Economist

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Finland GDP Chart

Finland GDP Q1 2015

Note: Quarter-on-quarter changes of seasonally-adjusted GDP in %.
Source: Statistics Finland and FocusEconomics Consensus Forecast.

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