Despite the threats posed by the ongoing trade war between the US and China as well as the economic impact of Brexit, there are many positive trends taking place in the economies of Finnish residents, according to a fresh report from analyst group Pellervo Economic Research PTT.
There is a possibility for further consumption growth, according to the group, but consumers appear to be more likely to put their money away for rainy days, due to improved employment rates and salary increases.
Consumption growth levels have fallen by about half since 2017, likely due to consumers' increased uncertainty about the future, the report said.
Last year consumption growth levels were largely hurt by a collapse in auto sales, due to emission standards problems, the group said. But now, the vehicle trade has recovered, fuel has become more affordable and savings levels have returned to normal levels - factors which the economic assessment said were good for households.
Retail sales were also positive over the summer and outlooks within the service sector are also bright, according to the PTT report.
Growth expected, barring no-deal Brexit
One looming, dark economic cloud has been the decline in industry, which can be observed in the sector's recent spate of job cuts and stagnating wage growth, according to the report.
However, PTT estimated that the Finnish economy will grow by 1.3 percent this year and by 1.2 percent in 2020.
The group noted that much of that growth depends on how Britain's planned departure from the EU and the global trade war unfold, saying that a so-called no-deal Brexit would bring economic growth to zero, unless government takes action.
The group also said it expects that the US and China will not come to agreement and that the uncertainty surrounding Brexit will continue into next year. Additionally, US President Donald Trump's administration has not increased corporate confidence, as firms are unable to rely on the free movement of goods and have been forced to rethink supply chains.
The problems within the global economy have also been reflected in Finland's trade and exports have slowed. However, the group said there are some domestic economic bright spots, particularly within the paper industry.
Demand for paper has again restarted in China, but there has been inadequate supply in the Asian country, which means that Finnish paper goods exports to China will increase towards the end of this year, according to the report.