In the wake of the global pandemic, Finland’s economy has been hit hard. Private consumption, which accounts for about half of the country’s GDP, has taken a particularly significant hit. However, experts are optimistic that private consumption will play a key role in accelerating the recovery of the Finnish economy.
Despite slight growth in recent months, experts believe that the real celebration of consumption growth may not come until next year. One economist, Janne Ronkanen, emphasizes the importance of private consumption in driving economic improvement. He believes that improving consumer confidence is crucial to boosting private spending and supporting economic recovery.
The financial situation of Finnish households is still tight due to factors such as high inflation and rising interest rates. While there have been improvements with inflation slowing down and real wages increasing, there is still room for progress in terms of rebuilding purchasing power lost during the inflationary period.
Ronkanen’s focus is on monitoring consumer confidence and household financial situations closely. He believes that enhancing consumer confidence through factors such as lower market interest rates could stimulate private spending and support economic recovery in the long run.
Looking ahead, Ronkanen expects a modest recovery in consumption but warns that challenges such as potential increases in inflation could impact consumers’ purchasing power negatively. He also highlights the need to monitor external factors like interest rates and their impact on household finances to ensure sustained economic growth in the future.
