GDP in Finland
Finland - GDP
Economy rebounds in Q3, recording best result since Q2 2010
GDP rebounded strongly in the third quarter, growing 3.3% on a seasonally-adjusted quarter-on-quarter basis and contrasting the 3.9% contraction recorded in the second quarter. Q3's reading marked the strongest growth in over two decades, largely reflecting the gradual easing of pandemic-related restrictions during the quarter. Meanwhile, on an annual basis, GDP contracted 2.7% in Q3, easing from Q2’s 6.2% fall.
Domestically, household spending rebounded in the third quarter, growing 2.9% in seasonally-adjusted quarter-on-quarter terms, which marked the best reading since Q1 2012 (Q2: -5.3% s.a. qoq). However, the print came amid a strong increase in the unemployment rate in the quarter (Q3: 8.4%; Q2: 6.7%), likely capping the upturn. Government spending also rebounded, albeit at a much softer pace (Q3: +0.4% s.a qoq; Q2: -1.8% s.a qoq), while fixed investment continued to contract, although at a much slower pace than in the prior quarter (Q3: -0.3 s.a qoq; Q2: -1.5% s.a qoq).
Externally, exports of goods and services increased 2.6% on a seasonally-adjusted quarterly basis in the third quarter, which contrasted the second quarter's 11.1% dive. Additionally, imports of goods and services rebounded, growing 4.7% in Q3 (Q2: -12.6% s.a. qoq). As such, the external sector detracted 0.9 percentage points from overall growth for Q3 (Q2: +0.9 percentage points).
The economy is expected to contract notably this year due to the fallout from the pandemic. Despite Q3’s positive results, the second wave of infections has likely hampered activity once again, erasing some of the progress made in the quarter. Recovery is expected to be somewhat slow, potentially encouraging households to increase their savings, which, coupled with the high unemployment rate, will likely cap private spending ahead.
This is something Rosie Colthorpe, European economist at Oxford Economics, agrees with, noting the risks clouding the outlook:
“Although Finland has imposed fewer virus-related restrictions than many other European countries, the services sector is still likely to have a tough Q4. Weak consumer confidence and uncertainty about the outlook are likely to lead to households holding higher precautionary savings, weighing on private consumption. High unemployment will also hold back spending.”
Our panelists see the economy growing 2.7% in 2021, which is down 0.4 percentage points from last month’s forecast. In 2022, the panel projects that GDP will expand 2.3%.
Finland - GDP Data
|Economic Growth (GDP, annual variation in %)||0.5||2.7||3.1||1.7||0.9|
5 years of economic forecasts for more than 30 economic indicators.
Finland GDP Chart
Source: Statistics Finland.
|Bond Yield||0.03||3.70 %||Dec 30|
|Exchange Rate||8.78||-0.38 %||Jan 01|
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December 15, 2020
Economic activity decreased 1.9% year-on-year in working-day adjusted terms in October, following the 2.1% contraction recorded in September (previously reported: -3.2% year-on-year).
December 14, 2020
Consumer prices decreased 0.07% in November over the previous month, swinging from October’s 0.10% increase.
December 11, 2020
The current account recorded a EUR 0.5 billion surplus in October, matching the surplus recorded in October last year, and increasing from September’s EUR 0.1 billion surplus.
November 27, 2020
GDP rebounded strongly in the third quarter, growing 3.3% on a seasonally-adjusted quarter-on-quarter basis and contrasting the 3.9% contraction recorded in the second quarter.
November 13, 2020
The current account recorded a EUR 0.1 billion surplus in September, matching the surplus recorded in September last year, although it inched down from the previous month’s EUR 0.2 billion surplus.