Follow our expert insights about how the markets and inflation develop in the Nordics and globally.
Economic Outlook
Finnish economic outlook: Stunted growth
The Finnish economy has seen cautious growth, but the economic cycle remains weak. Consumers are still cautious, even though purchasing power has started to improve and interest rates have fallen.
The global economic outlook for 2025 reflects a very high level of uncertainty, and economic developments could easily surprise in either direction. Our baseline story remains unchanged, and we expect monetary policy easing to support growth especially in the Euro area and China – and in both regions consumer spending could surprise to the upside.
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Economic data has been weaker in all the major economies during the summer and labour markets are weakening. This could encourage China to ease fiscal policy further, and the western central banks are expected to cut rates.
The Finnish economy has underperformed the rest of the eurozone over the past two years. Private consumption has gone down in Finland, as higher interest rates have hit households hard. However, most of the gap to the rest of the eurozone is due to the sharp decrease in residential construction in Finland.
We saw the first positive signs for the Finnish economy in the first half of the year. The gradual recovery in consumer purchasing power and lower interest rates are expected to send the Finnish economy back on a growth track.
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The global growth momentum has improved slightly since the beginning of this year thanks to China’s increased fiscal stimulus and declining inflation numbers in many western economies.
Swedish economic outlook: Searching for equilibrium
After several turbulent years the pieces of the puzzle are gradually falling into place for the Swedish economy. Households’ consumption pattern normalises, export companies’ production will balance with demand and inflation will stabilise at low levels.
High interest rates have sent the Finnish economy into a recession. Mortgage holders and the public sector are adapting their spending to respond to higher interest rates, which has weakened demand but will lead to more balanced finances.
Initial research suggests that using artificial intelligence can significantly improve productivity. Due to its high digital readiness, Finland is in a good position to leverage AI. After all, AI creates an opportunity for Finnish companies to get back on the productivity growth track.