December 2016

Source: Bank of Finland forecast December 2016.
1. BALANCE OF SUPPLY AND DEMAND, AT REFERENCE YEAR 2010 PRICES
% change on previous year
  2015 2016 2017f 2018f 2019f
GDP at market prices 0.2 1.0 1.3 1.2 1.2
Imports of goods and services 1.9 1.2 2.0 2.1 1.9
Exports of goods and services                                  -0.2 0.7 2.1 2.5 2.6
Private consumption 1.5 1.9 1.4 1.0 0.9
Public consumption 0.4 0.3 0.3 0.3 -0.3
Private fixed investment 2.2 5.8 3.4 2.5 2.7
Public fixed investment -5.1 3.1 0.6 -0.2 -0.1

 

Source: Bank of Finland forecast December 2016.
2. CONTRIBUTIONS TO GROWTH1
  2015 2016 2017f 2018f 2019f
GDP, % change 0.2 1.0 1.3 1.2 1.2
Net exports -0.8 -0.2 0.0 0.1 0.3
Domestic demand excl. inventory change 1.0 2.2 1.5 1.1 0.9
of which Consumption 0.9 1.2 0.8 0.6 0.4
Investment 0.1 1.1 0.6 0.4 0.5
Inventory change + statistical discrepancy 0.0 -1.1 -0.2 0.0 0.0
1 Bank of Finland calculations. Annual growth rates using the previous year's GDP shares at current prices as weights.
Source: Bank of Finland forecast December 2016.
3. BALANCE OF SUPPLY AND DEMAND, PRICE DEFLATORS
Index 2010 = 100, and % change on previous year          
  2015 2016 2017f 2018f 2019f
GDP at market prices 112.0 113.3 113.2 113.6 114.4
  1.6 1.2 -0.1 0.3 0.7
Imports of goods and services 100.6 98.5 101.6 104.3 106.5
  -4.0 -2.0 3.1 2.7 2.1
Exports of goods and services                                  103.3 100.7 103.2 105.2 107.1
  -0.9 -2.5 2.5 2.0 1.8
Private consumption 110.8 111.4 112.0 112.7 113.6
  0.4 0.5 0.6 0.7 0.8
Public consumption 112.6 114.3 113.7 114.1 114.8
  0.2 1.5 -0.5 0.4 0.6
Private fixed investment 109.4 111.2 112.4 113.4 114.9
  0.5 1.6 1.0 0.9 1.3
Public fixed investment 110.3 112.2 114.3 114.8 115.6
  0.1 1.7 1.9 0.4 0.8
Terms of trade (goods and services) 102.7 102.2 101.6 100.9 100.6
  3.3 -0.5 -0.6 -0.7 -0.3

 

Source: Bank of Finland forecast December 2016.
4. BALANCE OF SUPPLY AND DEMAND, AT CURRENT PRICES
EUR million and % change on previous year
  2015 2016 2017f 2018f 2019f
GDP at market prices 209,149 213,663 216,225 219,620 223,805
  1.8 2.2 1.2 1.6 1.9
Imports of goods and services 77,548 76,869 80,780 84,665 88,096
  -2.2 -0.9 5.1 4.8 4.1
Total supply 286,697 290,532 297,005 304,286 311,901
  0.7 1.3 2.2 2.5 2.5
Exports of goods and services                                  76,579 75,193 78,715 82,286 85,969
  -1.0 -1.8 4.7 4.5 4.5
Consumption 166,733 170,560 172,795 175,163 177,429
  1.5 2.3 1.3 1.4 1.3
Private 115,711 118,595 120,929 122,941 125,049
  1.8 2.5 2.0 1.7 1.7
Public                                                      51,022 51,965 51,865 52,221 52,380
  0.6 1.8 -0.2 0.7 0.3
Fixed investment                                                    42,718 45,695 47,582 48,931 50,603
  1.1 7.0 4.1 2.8 3.4
Private 34,562 37,146 38,821 40,154 41,771
  2.7 7.5 4.5 3.4 4.0
Public                                                      8,156 8,549 8,761 8,777 8,832
  -5.1 4.8 2.5 0.2 0.6
Inventory change + statistical discrepancy 667 -916 -2,086 -2,094 -2,101
% of previous year's total demand 0.0 -0.6 -0.4 0.0 0.0
Total demand 286,697 290,532 297,005 304,286 311,901
  0.7 1.3 2.2 2.5 2.5
Total domestic demand 210,118 215,339 218,291 221,999 225,931
  1.4 2.5 1.4 1.7 1.8

 

Source: Bank of Finland forecast December 2016.
5. BALANCE OF SUPPLY AND DEMAND
% of GDP at current prices
  2015 2016 2017f 2018f 2019f
GDP at market prices 100.0 100.0 100.0 100.0 100.0
Imports of goods and services 37.1 36.0 37.4 38.6 39.4
Exports of goods and services                                  36.6 35.2 36.4 37.5 38.4
Consumption 79.7 79.8 79.9 79.8 79.3
Private 55.3 55.5 55.9 56.0 55.9
Public 24.4 24.3 24.0 23.8 23.4
Fixed investment 20.4 21.4 22.0 22.3 22.6
Private 16.5 17.4 18.0 18.3 18.7
Public 3.9 4.0 4.1 4.0 3.9
Inventory change + statistical discrepancy, 0.3 -0.4 -1.0 -1.0 -0.9
Total demand 137.1 136.0 137.4 138.6 139.4
Total domestic demand 100.5 100.8 101.0 101.1 101.0

 

Source: Bank of Finland forecast December 2016.
6. PRICES
Index 2010 = 100, and % change on previous year
  2015 2016 2017f 2018f 2019f
Harmonised index of consumer prices, 2005=100 100.0 100.4 101.1 102.0 103.0
  -0.2 0.4 0.8 0.8 1.0
Consumer price index, 2005=100 100.0 100.4 101.1 101.9 102.9
  -0.2 0.4 0.7 0.8 1.0
Private consumption deflator                                          110.8 111.4 112.0 112.7 113.6
  0.4 0.5 0.6 0.7 0.8
Private investment deflator 109.4 111.2 112.4 113.4 114.9
  0.5 1.6 1.0 0.9 1.3
Exports of goods and services deflator 103.3 100.7 103.2 105.2 107.1
  -0.9 -2.5 2.5 2.0 1.8
Imports of goods and services deflator 100.6 98.5 101.6 104.3 106.5
  -4.0 -2.0 3.1 2.7 2.1
Value-added deflators                                                       
Value-added, gross at basic prices                                        111.9 113.8 113.9 114.4 115.2
  1.8 1.6 0.2 0.4 0.7
Private sector 111.2 113.3 113.8 114.2 115.0
  2.1 1.9 0.4 0.4 0.7
Public sector 115.1 115.5 114.7 115.0 115.9
  0.7 0.4 -0.8 0.3 0.8

 

Source: Bank of Finland forecast December 2016.
7. WAGES AND PRODUCTIVITY
% change on previous year
  2015 2016 2017f 2018f 2019f
Whole economy
Index of wage and salary earnings 1.4 1.3 0.3 0.8 1.3
Compensation per employee 1.6 1.1 -0.5 0.6 1.0
Unit labour costs 1.0 0.5 -1.2 0.0 0.4
Labour productivity per employed person 0.6 0.6 0.7 0.7 0.5
Source: Bank of Finland forecast December 2016.
8. LABOUR MARKET
1,000 persons and % change on previous year
  2015 2016 2017f 2018f 2019f
Labour force survey (15–74-year-olds)
Employed persons 2,437 2,446 2,460 2,474 2,491
  -0.4 0.4 0.6 0.6 0.7
Unemployed persons 252 237 228 224 223
  8.7 -6.2 -3.7 -1.7 -0.5
Labour force 2,689 2,683 2,688 2,698 2,714
  0.4 -0.3 0.2 0.4 0.6
Working-age population (15–64-year-olds) 3,474 3,463 3,452 3,444 3,437
  -0.4 -0.3 -0.3 -0.2 -0.2
Labour force participation rate, %                                                      65.6 65.3 65.2 65.3 65.6
Unemployment rate, % 9.4 8.8 8.5 8.3 8.2
Employment rate (15–64-year-olds), % 68.1 68.6 69.1 69.7 70.2

 

Source: Bank of Finland forecast December 2016.
9. GENERAL GOVERNMENT REVENUE, EXPENDITURE, BALANCE AND DEBT
% OF GDP
  2015 2016 2017f 2018f 2019f
General government revenue 54.9 54.9 54.3 54.2 54.0
General government expenditure 57.7 57.4 56.9 56.6 56.2
General government primary expenditure 56.5 56.4 55.9 55.7 55.3
General government interest expenditure 1.2 1.0 1.0 0.9 0.9
General government net lending -2.8 -2.5 -2.6 -2.4 -2.2
Central government -3.0 -2.9 -2.8 -2.5 -2.0
Local government -0.6 -0.7 -0.6 -0.6 -0.6
Social security funds 0.9 1.1 0.8 0.6 0.4
General government primary balance -1.6 -1.4 -1.7 -1.5 -1.3
General government debt (EDP) 63.6 65.6 68.2 70.1 71.3
Central government debt 47.7 49.4 51.6 53.3 54.3
Tax ratio 44.1 44.2 43.7 43.7 43.6

 

Source: Bank of Finland forecast December 2016.
10. BALANCE OF PAYMENTS
EUR million
  2015 2016 2017f 2018f 2019f
Exports of goods and services (SNA) 76,579 75,193 78,715 82,286 85,969
Imports of goods and services (SNA) 77,548 76,869 80,780 84,665 88,096
Goods and services account (SNA) -969 -1,676 -2,065 -2,379 -2,126
% of GDP -0.5 -0.8 -1.0 -1.1 -1.0
Investment income and other items, net (+ statistical discrepancy) 2,420 2,109 2,222 2,212 2,202
Current transfers, net -2321 -2068 -2096 -2132 -2176
Current account, net -870 -1,636 -1,939 -2,299 -2,100
Net lending, % of GDP
Private sector 2.3 1.7 1.7 1.4 1.3
Public sector -2.8 -2.5 -2.6 -2.4 -2.2
Current account, % of GDP -0.4 -0.8 -0.9 -1.0 -0.9

 

Source: Bank of Finland forecast December 2016.
11. INTEREST RATES
%
  2015 2016 2017f 2018f 2019f
3-month Euribor1 0.0 -0.3 -0.3 -0.2 0.0
Average interest rate on new loan drawdowns2 2.1 1.8 1.8 1.9 2.1
Average interest rate on the stock of loans2 1.6 1.5 1.4 1.5 1.6
Average interest rate on the stock of deposits3 0.3 0.2 0.1 0.1 0.2
Yield on Finnish 10-year government bonds1 0.7 0.4 0.7 0.9 1.1
1 Technical assumption derived from market expectations.
2 Finnish credit institutions’ loans to households and non-financial corporations (excl. overdrafts, credit card credits and repurchase agreements).
3 Finnish credit institutions’ deposits from households and non-financial corporations.

 

Source: Bank of Finland forecast December 2016.
12. INTERNATIONAL ENVIRONMENT
The Eurosystem staff projections
  2015 2016 2017f 2018f 2019f
GDP, % change on previous year
World 3.1 2.9 3.3 3.4 3.5
USA 2.6 1.5 2.0 2.0 2.0
Euro area 1.9 1.7 1.7 1.6 1.6
Japan 0.6 0.7 0.9 0.8 0.7
Imports, % change on previous year
World 1.9 1.5 3.2 3.9 4.0
USA 4.6 0.7 3.0 4.5 4.4
Euro area 6.2 3.3 4.1 4.3 4.1
Japan 0.4 -1.7 1.5 2.7 3.0
Index, 2010 = 100, and % change on previous year
Import volume in Finnish export markets 113.1 115.2 118.4 122.7 127.2
  0.1 1.8 2.8 3.6 3.7
Export prices (excl. oil) of Finland's trading partners, national currencies 102.7 101.0 103.8 106.3 108.6
  -0.5 -1.7 2.7 2.4 2.2
Export prices (excl. oil) of Finland's trading partners, in euro 109.1 105.8 107.2 109.8 112.2
  3.9 -3.0 1.3 2.4 2.2
Industrial raw materials (excl. energy), HWWA index, in US dollars 98.0 95.9 104.1 107.8 112.8
  -25.0 -2.1 8.6 3.6 4.6
Oil price, USD per barrel1 52.4 43.1 49.3 52.6 54.6
  -47.1 -17.6 14.3 6.7 3.7
Finland's nominal competitiveness indicator1, 2 97.8 99.1 100.5 100.5 100.5
  -4.3 1.4 1.4 0.0 0.0
US dollar value of one euro1 1.11 1.11 1.09 1.09 1.09
  -16.5 0.2 -1.9 0.0 0.0
1 Technical assumption derived from market expectations.
2 Narrow plus euro area, 1999Q1 = 100

 

Source: Bank of Finland forecast December 2016.
13. Current and June 2016 forecast
  2016 2017f 2018f 2019f
GDP, % change 1.0 1.3 1.2 1.2
June 2016 1.1 1.1 1.0  
Inflation (HICP), % 0.4 0.8 0.8 1.0
June 2016 0.2 0.8 1.0  
Current account, % of GDP -0.8 -0.9 -1.0 -0.9
June 2016 -0.6 -0.8 -0.7  
General government net lending, % of GDP -2.5 -2.6 -2.4 -2.2
June 2016 -2.6 -2.4 -2.3  
General government debt (EDP), % of GDP 65.6 68.2 70.1 71.3
June 2016 66.0 68.4 70.2  
Unemployment rate, % 8.8 8.5 8.3 8.2
June 2016 9.2 9.0 8.9  

 

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