Finland: GDP in Q3 sees largest contraction in almost three years
December 4, 2015
According to official data released by Statistics Finland on 4 December, the Finnish economy contracted a seasonally-adjusted 0.5% in Q3 2015 over the previous quarter, which represented the lowest reading since Q4 2012. The print contrasted the revised 0.4% expansion recorded in Q2 (previously reported: 0.2% quarter-on-quarter). In annual terms, GDP registered a 0.8% decrease in Q3 (Q2: +0.6% year-on-year).
The quarterly decrease was mainly due to a stark deterioration in the external sector, offsetting a mild expansion in domestic demand. Private consumption rose 0.8% over the previous quarter, up from the 0.1% increase that was tallied in Q2. Government spending inched down over the previous quarter (Q3 +0.1% qoq, Q2: +0.2% qoq). Fixed investment fell sharply, by 1.4% in Q3, a staunch deterioration from the 0.2% contraction recorded in Q2.
On the external front, exports contracted a seasonally-adjusted 0.7% in Q3, which was below the 0.5% decrease observed in Q2. Imports recorded a 1.8% increase in Q3, which marked a strong recovery and contrasted the 4.7% decrease seen in Q2. As a result, the external sector’s net contribution to GDP growth deteriorated from plus 1.7 percentage points in Q2 to minus 1.0 percentage points in Q3, the largest detraction since Q4 2011.
Author: Robert Hill, Economist