Consumer prices soared in February, led by higher food, electricity and mortgage prices
Food prices in Finland saw a historic jump of 16.3% last month in annual terms, official data showed on Tuesday. The figure represents the strongest price growth since 1964, the country’s statistics agency reported.
The data showed that the high cost of electricity, food and rising interest rates on loans were the main drivers of inflation on an annual basis.
According to the report, the core inflation rate, which excludes food and energy prices, continued to rise sharply and reached 6.6% in February.
Jukka Appelqvist, chief economist at Finland’s Central Chamber of Commerce, said while prices may not continue to rise as quickly as in February, lingering inflationary pressures are a major economic risk. The official noted that there were no signs of an uncontrollable downward spiral in prices and wages in the country. However, he warned that a stable and low rate of inflation is unlikely to occur in the near future.
Increasing tight monetary policy and rising interest rates could lead to a deeper-than-expected recession, Appelqvist suggested.
The EU nation slipped into recession in the fourth quarter of last year after GDP fell more than expected from the previous three-month period. The decline was led by exports, investment and consumption, according to official data.
Economists have predicted a slight recession for the Finnish economy this year before a rebound in 2024.
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