Despite the promising economic outlook towards the end of the year, ordinary consumers in Finland are not yet reflecting this in their spending habits. This is due to a significant drop in consumer purchasing power in recent years, leading to cautious consumer behavior and a rise in savings rate. The Savings Bank Group emphasizes that it will take time for the country’s economy and purchasing power to recover.
The group’s chief economist, Henna Mikkonen, notes that consumers are still quite cautious and not all income increases will be channeled into consumption. Accumulating savings buffers for future use is seen as a sensible approach in light of recent financial uncertainties. Despite the current low consumer confidence, Mikkonen expresses hope for a slow recovery in consumer sentiment throughout the year.
The Savings Bank Group expects the country’s economic prospects to initially be slow at the beginning of the year, with improvements projected towards the end of the year. Factors such as slowing inflation and falling interest rates provide some relief for consumers, but uncertainties in the labor market and perceived threats of unemployment continue to weigh on consumer confidence.
In light of the drop in interest rates, the Savings Bank Group emphasizes responsible borrowing behavior and notes that consumers are currently hesitant to take out large loans. The group anticipates a continuation of the slow pace in the housing market, with expectations that a lowering of key interest rates in June will stimulate housing market activity in
