Bank of Finland Bulletin : Economic outlook

Abstract

Preface 1 Bank of Finland forecasts 3 Executive summary 4 Recent development 6 Box 1. National accounts for the first quarter of 2011 9 Operating environment 10 Box 2. Recent euro area monetary policy 14 Non-financial corporations 17 Households 19 GDP and employment 21 Box 3. Job-matching in the labour market after the recession 24 Public finances 25 Box 4. Medium-term outlook for public finances 28 Box 5. Central and local government financial assets 30 External balance 32 Box 6. Finland's net international investment position has improved by less than the current account surpluses indicate 33 Price and wage trends 36 Box 7. Inflation higher in Finland than in the euro area 38 Risk assessment 40 Box 8. Alternative scenario: an increase in domestic wage and price pressures 43 Changes from the previous forecast 47

Long-term supply of labour Helvi Kinnunen and Petri Mäki-Fränti 49

An estimated general equilibrium model for forecasting Elisa Newby, Jukka Railavo and Antti Ripatti 58

Bank of Finland's forecast errors in 2004-2010 Elisa Newby and Seppo Orjasniemi 67

Articles and boxes from previous publications 75

Forecast tables T1