Resilient growth across Finland in Q2, but headwinds dominate

We have cut our 2023 GDP growth forecast for Finland by 0.3ppts to 0.5%. Although growth in Q2 remained resilient based on the flash estimate, pushing up our forecast for 2022 to 2.2%, the near-term outlook remains dominated by headwinds. High inflation is increasingly passing through to core prices, squeezing real incomes and denting confidence.

What you will learn:

• Gas and electricity prices remain elevated, although Finland has cut its gas consumption by almost 60% YTD.
• After an Omicron-related drop in January, activity increased in the following months despite the outbreak of the Russia-Ukraine war.
• However, a slowdown is imminent, with record low consumer confidence and weakening business confidence across sectors.