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Fast Comment FinlandManufacturing activity on a solid growth trend

  1. Finnish manufacturing grew 5.4 percent y-o-y in June
  2. Solid growth trend continues
  3. Finnish industry still supported by the global upturn
Finnish manufacturing grew 5.4 percent y-o-y in June
Output of total industries adjusted for working days increased by 5.4 percent y-o-y in June 2018. In m-o-m terms, the seasonally-adjusted industrial output increased by 1.6 percent. Production levels increased most in the metal industry, by 3.7 percent m-o-m. During first half of the year, the output of total industries went up by 4.5 percent y-o-y.
Solid growth trend continues
According to Statistics Finland, the value of new manufacturing orders increased by 5.4 percent y-o-y in June. With this return to a robust growth trend, the previous month's 35 percent decrease is clearly explained by a particularly strong reference month in May 2017. Within industries, the metal industry produced the largest increase also in new manufacturing orders, with a 8.5 percent gain from the previous year in June. In the manufacture of paper and paper products, new orders increased by 4.9 percent y-o-y. According to the preliminary statistics of foreign trade of goods provided by Finnish Customs, the value of Finnish goods exports increased by 4 percent y-o-y in June, whereas the value of goods imports increased by 2 percent y-o-y. During H1 2018, the value of goods exports and imports increased by 7 and 5 percent, respectively. However, the goods exports volume (deflated by exports prices) grew by only 2.6 percent y-o-y during January-June.
Finnish industry still supported by the global upturn
Despite the concerns about the global business cycle, Finnish manufacturing has performed well in H1 2018. Manufacturing production continues to grow steadily, with the metal industry leading the way. However, the growth rates of Finnish export volumes have clearly weakened from last year, but one should also keep in mind that the performance of exports in 2017 was exceptionally strong, hence the activity level in Finnish industry is currently very high. This performance speaks of a healthy global demand backdrop for capital and intermediate goods, hence the industrial cycle looks to be in expansion mode still.

 





Disclaimer

Janne Ronkanen

Senior Economist

Finland

jaro06@handelsbanken.se

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