Finland cuts GDP growth forecast for 2023, eyes recession risks

Finland cuts GDP growth forecast for 2023, eyes recession risks

HELSINKI (Reuters) – Finland’s Finance Ministry on Monday lowered its 2023 economic growth forecast and said the country was at risk of recession.

The ministry now expects GDP to grow by 1.7% in 2022 and by 0.5% next year when it forecast in June growth of 1.4% this year and 1.1% in 2023.

“We are facing a period of stagnant growth and the risk that the economy will end in recession cannot be ruled out,” the ministry said in a statement.

“Uncertainty, energy shortages, rapid inflation, deteriorating purchasing power and rising rates will dampen consumption and investment growth everywhere,” the report said.

It estimated consumer price inflation at 6.5% this year, up from 5.8% in June, and 3.2% in 2023, up from a previously forecast 2.7%.

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