Finland economy contraction became evident in the second quarter of 2025 as GDP declined slightly, diverging from the modest growth seen across the European Union. Statistics Finland released figures on Thursday showing a 0.4% drop in gross domestic product volume compared to the previous quarter. Adjusted for working days, the year-on-year change was flat, while the EU recorded a 0.2% increase in GDP over the same period.
Antti Kosunen, senior statistician at Statistics Finland, explained that the downturn was mainly caused by declining household and public consumption. Private spending fell by 1.3% from the first quarter, and public sector consumption dropped by 1.0%. Kosunen noted that these reductions put significant pressure on GDP during April to June.
Foreign trade in Finland painted a mixed picture in Q2 2025. Exports decreased by 0.2% compared to the previous quarter, whereas imports surged by 2.5%. Investment, however, provided a positive counterbalance. Private investment rose 2.9%, and public investment jumped 5.1%. Kosunen highlighted that this trend could signal a more favorable economic trajectory in the near term.
Industrial production in Finland showed modest improvement, with the chemical industry leading gains. Other industrial sectors remained steady, but all major industries recorded annual growth when compared to the same quarter last year. Retail activity also increased slightly, supported mainly by stronger retail sales, while other trade areas remained stable.
Construction output experienced minor changes during Q2 2025. Building construction edged up by 0.1%, while civil engineering projects, including road and water infrastructure, declined by 0.5%. These variations contributed to the overall mixed signals in the economy.
Monthly data from the production trend indicator indicate a mixed trajectory for Finland’s economy. In July, total output was unchanged year-on-year but increased 0.4% from June after seasonal adjustment. This early indicator often provides a glimpse into future quarterly GDP movements, suggesting that Finland may experience a gradual recovery if investment and industrial growth continue.
