Finland will also drift into a moderate recession at the end of this year, forecasts Etla Economic Research. Economic growth will slow down to two per cent this year and for next year is projected only zero growth. According to the forecast, exports will benefit from the recovery of service exports but at the same time private consumption stiffens as the prices of goods will increase. Inflation will remain high next year even though the increase of prices will slow down slightly.
Our forecast:
Finland’s economic growth will slow down to 2.0 per cent this year. Finland will thus drift into a moderate recession at the end of this year. Next year, Finland’s GDP is projected to experience zero growth. Economic growth will be dampened by inflation, the tightening of monetary policy and the indirect effects of Russia’s war of aggression.
The economy will grow this year boosted in particular by consumption and investments. Inventories also contributed clearly to growth. On the other hand, the impact of net exports on growth is deeply negative. Next year net exports will bolster GDP as domestic demand will not increase and inventories will shrink.
The biggest risks are related to the development of the export market and …read more
Source:: ETLA