Editorial: Recovery continues – monetary policy under conflicting pressures

Although inflation will remain faster than in recent years longer than previously expected, many of the factors driving it are by their nature transitory and expected to largely cease to apply during the course of 2022. There is, nevertheless, considerable uncertainty. In Finland, we need reforms to strengthen the prospects for economic growth.

Newest publication – Published 17 Dec 2021

Bank of Finland Bulletin 5/2021 – Economic forecast for the Finnish economy

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Accessible summary: Finnish economy growing fast, but pace will slow in near future

The Finnish economy is growing at a good pace. Growth is overshadowed in the short term by COVID, and in the long term by factors such as the ageing population.

Forecast tables for 2021–2024 (December 2021)

The Finnish economy will grow 3.5% in 2021 and 2.6% in 2022.

The COVID-19 crisis built up indebtedness and increased external financing needs in low-income countries

The shock of the COVID-19 pandemic and the associated deterioration in the economic outlook has exacerbated solvency concerns and increased the risks of debt restructurings in low-income countries (LICs).

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BOFIT 30 years – from the Soviet Union to emerging economies

Adaptation to changing circumstances has been one of the hallmarks of the Unit’s – the Bank of Finland Institute for Emerging Economies (BOFIT) – work.

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Consumption and service sectors key factors in the global trade collapse during the COVID-19 crisis

The global economy and global trade flows have been hit hard by the COVID-19 crisis. The trade collapse in the second quarter of 2020 was even more severe than during the trough of the global financial crisis in 2009.

ECB revised its monetary policy strategy – what’s changed?

The ECB’s new monetary policy strategy is aimed at inflation of 2% over the medium term. The target is symmetrical. Both negative and positive deviations from this target are seen as equally undesirable.

Monetary policy measures taken during pandemic revived euro area economy

During the COVID crisis, the Eurosystem has purchased securities on the markets and granted banks loans on favourable terms. These measures have helped avoid a deep recession and deflation in the euro area.

Inflation expectations help in analysing the euro area inflation outlook

Inflation expectations play a key role in inflation projections. Different measures of inflation expectations point towards inflation remaining below the ECB's 2% target in the coming years.

Economy recovering apace

The Finnish economy strengthened faster than expected in the course of spring and summer 2021.

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