Finnish economic forecasters defend predictions after accuracy criticism

Tuesday 11th August 2026 on 19:30 in Finland

economic forecasts, Finnish economy, Ministry of Finance

Finnish economic forecasters have defended their work after a Kalevi Sorsa Foundation report criticised the accuracy of forecasts used to guide political decisions, Yle reported. Mikko Spolander, director general at the Ministry of Finance, said the figures matter less than the overall economic narrative they create.

The ministry produces the most influential forecast on the direction of the Finnish economy four times a year. Spolander acknowledged that forecasts have often been seriously wrong in recent years, but said the period had been marked by exceptional events.

He cited the prolonged euro crisis, the pandemic, Russia’s invasion of Ukraine, inflation, rising interest rates and uncertainty related to trade policy.

The foundation’s criticism focused particularly on the use of inaccurate forecasts when making political decisions, including preparations for the state budget. Other forecasting organisations examined in the report included the Research Institute of the Finnish Economy, Etla, the Bank of Finland, OP, Nordea, Pellervo Economic Research, PTT, and the Labour Institute for Economic Research, Labore.

Official figures can change the economic picture

Spolander said the ministry’s forecasts, like those of other organisations, are based on Statistics Finland’s data on the growth of gross domestic product.

However, preliminary economic growth figures can differ substantially from the final figures. Confirmed data is not available until about two years later, he said.

“Our forecasts are inaccurate because the material we use is inaccurate,” Spolander said.

The Kalevi Sorsa Foundation report also highlighted the issue. In June, Statistics Finland revised its figures and reported that the economy had grown by nearly one percentage point in 2024, while the first preliminary estimate had indicated that the economy might have contracted.

The revision significantly changed the overall picture of the Finnish economy. Earlier, there had been questions about why the economy was not growing, and Spolander had referred to an “unknown brake” on economic growth.

“Perhaps the brake did not exist at all,” he said.

Forecasters defend the overall picture

Despite the shortcomings, Spolander considers economic forecasts useful tools. He said the various pieces of information must be combined into an internally consistent view of the current economic situation and the future.

Forecasts include numerous figures from different parts of the economy, such as spending by companies and households.

Spolander questioned whether adding more individual indicators, as recommended by the foundation’s report, would improve the forecasts. The report’s authors, Lauri Finér and Jussi Systä, suggested that political decision making should also draw on up-to-date information about tax revenue and employment.

Spolander said the strength of economic forecasts lies in combining many pieces of information into a coherent narrative.

“The decimal points themselves are not very interesting or important. The story is,” he said.

PTT excludes shock years from its assessment

During Tuesday, other forecasting organisations criticised in the report also responded to its findings. They too stressed that recent years had been exceptional.

Pellervo Economic Research, PTT, calculated how far its own forecasts had deviated from the actual figures. However, it excluded 2020 and 2022 from its calculation, the years when the pandemic and the war in Ukraine began.

Without those shocks, PTT’s result was considerably more favourable. Its forecast error was 0.4 percentage points, compared with an average error of 1.4 percentage points for PTT forecasts in the Kalevi Sorsa Foundation report.