Operating environment

Financial Statements Bulletin 2022, 16 February 2023

The following outlook information is based on materials published by the Confederation of Finnish Industries EK and Statistics Finland.

The growth estimates for the world economy have slightly improved but great uncertainties still remain, and recession is very likely in significant part of the world economy in 2023. The world economy in 2023 is estimated to grow at a rate of some 1.7 percent, while the growth for Euro area is expected to be zero. New guidelines in China regarding the coronavirus pandemic situation as well as lower energy prices are expected to bring relief to the world economy whereas general inflation, increasing interest rates and Russia’s war against Ukraine have a weakening impact on expectations.

The economic outlook for Finland has continued to recede. While expectations for the future have slightly improved, they continue to be weak. The confidence indicator for the retail trade strengthened in January 2023 but is still below the long-term average. Sales were almost at the same level as last fall, but sales expectations for the coming months are pessimistic. Inventories decreased but continue to be clearly above the usual level. Consumer confidence increased slightly from the gloomy figures of the fall. Estimates of the current state of personal finances as well as expectations for the future of both personal finances and for Finland’s economy continued to be at a very low level and clearly weaker than the year before. Estimates for inflation as well as the expectations for its future development slightly decreased from the all-time high at the end of fall.
(Confederation of Finnish Industries EK: Business Tendency Survey, January 2023; Confidence Indicators, January 2023. Statistics Finland: Consumer Confidence, January 2023).

The working-day-adjusted turnover of Finnish retail trade in December grew by 2.4 percent on the previous year. The volume of sales was down by 6.1 percent. The cumulative working-day-adjusted turnover of retail trade in the January-December period rose by 3.7 percent but the volume of sales decreased by 3.6 percent.
(Statistics Finland: Turnover of Trade, retail trade flash estimate, December 2022).