People shopping in the Sello shopping centre in Espoo. LEHTIKUVA
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Consumer confidence in the economy remained low in February, with concerns over both personal and national finances worsening compared to January. The consumer confidence index stood at -9.0 in February, down from -8.4 the previous month, according to Statistics Finland.
A majority of consumers—64%—believed that Finland’s economic situation was worse than a year ago, while only 9% saw improvement.
Expectations for economic recovery remained low, with just over a fifth of consumers believing conditions would improve within a year.
“The figures reflect the ongoing economic downturn, not just in Finland but also in key export markets across Europe. Additionally, global instability, including conflicts, contributes to the negative sentiment,” said Pertti Kangassalo, Senior Statistician at Statistics Finland.
Concerns about job security grew, with 61% of consumers expecting unemployment to rise over the next year. More than a quarter felt that their personal risk of unemployment or temporary layoffs had increased.
“Employment is now weakening in line with Finland’s previous economic trends, albeit with some delay. Many consumers and workers have also begun to feel the impact of budget cuts and austerity measures on their personal finances,” Kangassalo said.
The data indicated that February was seen as a particularly poor time for major purchases. Only 11% of consumers considered it a good time for buying durable goods.
Spending intentions also remained weak, with 40% of consumers planning to cut back on major purchases in the next year, while only 12% planned to increase spending.
“Low confidence and weak personal financial assessments are known to impact consumer behaviour. Although purchasing power has generally improved due to lower inflation, declining interest rates, and wage increases, job insecurity continues to weigh heavily on spending decisions,” Kangassalo noted.
Interest in buying a home remained below average.
“The housing market is expected to pick up this year, but it remains uncertain whether consumer interest will translate into actual transactions in the coming months,” Kangassalo said.
Consumers estimated that prices had risen by 5.5% over the past year and expected inflation to continue at 4.2% over the next 12 months.
“Consumers still perceive inflation to be much higher than official statistics suggest. These perceptions influence financial decisions and spending habits significantly,” Kangassalo added.
HT
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Source: www.helsinkitimes.fi
