Key facts
- Finland's economy is growing faster than previously projected.
- Exports and investment are driving the economic growth.
- Unemployment is expected to fall from double digits by 2027.
- GDP is forecast to grow 1.7% this year and 1.6% in 2027.
- Inflation is expected to rise to 2.4% this year before easing.
- Google plans to invest at least €13 billion in AI infrastructure in Finland.
The Finnish economy is showing signs of stronger growth than previously anticipated, according to the Bank of Finland (BoF). The central bank now projects GDP to grow by 1.7% this year and 1.6% in 2027, upward revisions from earlier forecasts. This improved outlook is attributed to increased exports and investment.
The BoF also revised last year's growth to 0.8% from 0.2%. Head of Forecasting Juuso Vanhala stated that the economy's performance in the first part of the year was stronger than forecast, with rising exports and investment creating conditions for more widespread growth.
While the unemployment rate is expected to remain around 10.4% this year, the BoF anticipates a decline to 9.8% in 2027 and 9.0% in 2028 due to increasing labor demand.
Inflation is projected to reach 2.4% this year, driven by higher energy prices linked to the Middle East conflict, but is expected to be temporary, falling to 1.4% in 2027.
A significant boost for the economy comes from Alphabet's Google, which announced it will invest at least €13 billion ($15 billion) in AI infrastructure in Finland over the next two years, marking its largest European investment.