HELSINKI: The Bank of Finland in its latest economic growth outlook has given a bleak assessment of the Finnish economy.
According to the Bank of Finland, weaker international economic conditions, population ageing and only modest productivity developments have kept the situation in the Finnish economy unfavorable for many years. Despite the slow growth, the economy will begin to grow gradually as the export markets pick up and the accommodative stance of monetary policy supports recovery, said the Bank of Finland in a release.
According to the Bank’s forecast, the Finnish economy will still grow very slowly in 2015, at 0.2 percent. Finland will not reach the euro area pace of growth even in the next few years. Growth in 2016 and 2017 will be 1.2 percent and 1.3 percent, respectively.
The figures could turn out to be even lower if the global economy were to improve more slowly than expected. Domestic risks relate to the success of economic policy. In recent years, consumer prices in Finland have risen faster than elsewhere in the euro area. The weakness of economic activity will cause inflation in Finland to decline to 0.2 percent in 2015. As growth picks up, inflation will accelerate to 1 percent in 2016, remaining, however, below the euro area average.
