The Finnish economy's recent slump has been reflected in Statistic Finland's figures for industrial output during the month of November.
The number-crunching agency reported on Tuesday that the value of new orders in manufacturing fell by 8.9 percent in November 2022 compared to the same month last year, while seasonally adjusted industrial output fell by 1.2 percent from October.
In response to these figures, Jukka Appelqvist, Chief Economist at the Central Chamber of Commerce, told Yle that the Finnish economy's momentum has slowed and the outlook for manufacturing in particular turned much gloomier during the late autumn.
"As recently as the beginning of last year, industrial production was still growing at an excellent rate, and the economic downturn triggered by the war in Ukraine was starting from a good position in the industrial sector. The structure of Finnish industry is focused on large projects, so the weakness in new orders did not initially put a major damper on production volumes," Appelqvist noted.
However, the 1.2 percent monthly drop between October and November is less pronounced than in October, when seasonally adjusted industrial output fell by 2.3 percent from September.
Demand hit by inflation, interest rate rises
According to Danske Bank's Chief Economist Pasi Kuoppamäki, domestic demand has been affected by inflation and rising interest rates. In addition, he noted that Finland's trade with Russia has completely collapsed and global economic growth is stalling.
"The value of new orders also fell in Germany, for example," Kuoppamäki said.
He added however that Statistics Finland's figures do not indicate a significant downward spiral, which means that the figures fit the forecast of a mild recession.
This is in line with the Bank of Finland's prediction that the Finnish economy will enter a mild recession this year.
Statistics Finland's figures further revealed that the value of new orders fell in all the main manufacturing industries, with the biggest decrease, 10.9 percent, recorded in the metal industry.
"The drop is partly explained by the relatively high comparative level from last year, when November was a good month for orders," Appelqvist said, but noted that this latest reading is not particularly good.
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