Stronger Finnish consumer sentiment suggests solid GDP growth in near term – Nordea Bank

The rebound in the atmosphere surrounding the Finish economy is spectacular. Sentiment has improved in all sectors of the economy. The economic confidence indicator, which is the widest sentiment measure, is above its long-term average at present for the eighth consecutive month after the slump of more than four years.

Consumer sentiment is rising at a record level. In the past, readings like these were not seen even when the economy expanded at the rate of 5 percent a year, noted Nordea Bank in a research report. Consumers seem to be too positive at present and the indicate overshooting. Yet, robust confidence implies stronger GDP growth in the near term, stated Nordea Bank.

The improved economic outlook is evidently reflected in recent macro forecasts. The doomsday predictions, worries of contracting GDP are long gone. Consensus expectations are more upbeat. With the improved global outlook, the upside and downside risks to the Finnish economy seems greatly balanced.