Finland’s balance of trade for October 2025 posted a deficit of -0.43 billion EUR, improving from September’s -0.69 billion EUR but falling short of the 0.23 billion EUR forecast. This result continues a volatile trend seen over the past six months, with surpluses recorded in July (0.15 billion EUR) and August (0.53 billion EUR) before a sharp reversal in September and October. The 12-month average balance now stands near 0.05 billion EUR, reflecting a fragile equilibrium between exports and imports.

Drivers this month

• Exports contracted by 2.10% MoM, pressured by weaker demand in key EU markets and supply chain delays.
• Imports declined by 1.20% MoM, partly due to subdued domestic consumption and energy price moderation.
• Energy imports remained elevated, offsetting gains from machinery and electronics sectors.

Policy pulse

The BoT deficit aligns with the Bank of Finland’s cautious monetary stance amid persistent inflationary pressures. The central bank’s recent rate hikes have tempered domestic demand, indirectly influencing import volumes. Fiscal policy remains focused on budget consolidation, limiting stimulus that could boost trade-related activity.

Market lens

Immediate reaction: The EUR/FI currency pair weakened 0.30% within the first hour post-release, reflecting disappointment versus expectations. Finnish bond yields edged higher by 5 basis points, signaling mild risk repricing.

Core macroeconomic indicators provide context for the trade balance dynamics. Finland’s GDP growth slowed to 1.10% YoY in Q3 2025, down from 1.80% in Q2, driven by weaker export performance. Inflation remains elevated at 3.70% YoY, pressuring real incomes and consumption. Unemployment held steady at 6.20%, reflecting labor market resilience despite external headwinds.

Monetary policy & financial conditions

The Bank of Finland’s policy rate currently stands at 3.25%, up 75 basis points since mid-2025. Tighter financial conditions have increased borrowing costs, dampening investment and consumer spending. Credit growth slowed to 2.40% YoY, the lowest in two years.

Fiscal policy & government budget

Fiscal consolidation efforts continue, with the government targeting a budget deficit reduction to 1.80% of GDP in 2025 from 2.50% in 2024. Public investment in infrastructure remains stable but restrained, limiting potential export capacity expansion.

External shocks & geopolitical risks

Heightened geopolitical tensions in Eastern Europe and supply chain disruptions from Asia have constrained export volumes. Energy price volatility, though moderated recently, continues to impact import costs and trade balance volatility.

Drivers this month

• Declining exports to EU partners (-3.50% YoY) amid slower regional growth.
• Energy imports increased 4.20% MoM, driven by colder weather and supply constraints.
• Machinery exports remained flat, signaling sectoral stagnation.

Policy pulse

Monetary tightening has contributed to subdued import growth, partially offsetting export weakness. The trade deficit suggests limited external demand support for growth in the near term.

Market lens

Immediate reaction: EUR/FI depreciated 0.30%, while 2-year Finnish government bond yields rose 5 basis points, reflecting market caution on trade outlook.

Looking ahead, Finland’s balance of trade trajectory depends on several factors, including global demand, energy prices, and domestic policy responses. We outline three scenarios:

Bullish scenario (25% probability)

• Global growth stabilizes, boosting export demand by 3% YoY.
• Energy prices moderate, reducing import costs.
• Monetary policy eases in H2 2026, stimulating domestic demand.
• Result: BoT returns to modest surplus by Q3 2026.

Base scenario (50% probability)

• Global growth remains sluggish, exports flat YoY.
• Energy prices volatile but contained.
• Monetary policy remains restrictive, limiting import growth.
• Result: Persistent small deficits averaging -0.30 billion EUR monthly.

Bearish scenario (25% probability)

• Geopolitical tensions escalate, disrupting trade routes.
• Energy prices spike sharply, increasing import bills.
• Monetary tightening intensifies, suppressing domestic demand.
• Result: Deficits widen beyond -0.70 billion EUR monthly.

Finland’s October 2025 balance of trade reflects a complex interplay of external shocks, monetary policy, and structural challenges. The modest improvement from September’s deficit is encouraging but insufficient to signal a sustained turnaround. Policymakers face a delicate balancing act between containing inflation and supporting external competitiveness. Financial markets’ cautious response underscores uncertainty ahead. Structural reforms to diversify export markets and enhance supply chain resilience will be critical for long-term trade stability.

Key Markets Likely to React to Balance of Trade

Finland’s balance of trade data typically influences currency, bond, and equity markets sensitive to external trade flows and economic growth. The following symbols historically track or react to shifts in Finland’s trade dynamics:

• EURUSD – The euro-dollar pair often moves on trade data reflecting eurozone external demand.
• NOK.OL – Norway’s stock index correlates with Nordic trade and energy price shifts impacting Finland.
• BTCUSD – Bitcoin’s risk sentiment often shifts with macroeconomic data including trade balances.
• EURSEK – The euro-Swedish krona pair reflects regional trade and economic conditions.
• HEL.HE – Helsinki Stock Exchange index is directly sensitive to Finland’s economic fundamentals including trade.

Insight: Balance of Trade vs. EURUSD Since 2020

Since 2020, Finland’s balance of trade has shown a moderate positive correlation with the EURUSD exchange rate. Periods of trade surplus often coincide with euro strength against the dollar, reflecting robust external demand. Conversely, trade deficits tend to align with euro weakness, as seen in late 2025. This relationship underscores the sensitivity of Finland’s trade sector to currency fluctuations and global economic cycles.

FAQs

What is the current state of Finland’s balance of trade?

Finland recorded a trade deficit of -0.43 billion EUR in October 2025, improving from the previous month but below expectations.

How does the balance of trade affect Finland’s economy?

The trade balance influences GDP growth, currency strength, and inflation, impacting overall economic stability and policy decisions.

What are the main risks to Finland’s trade outlook?

Key risks include geopolitical tensions, energy price volatility, and tighter monetary policy dampening demand.

Finland’s trade deficit signals ongoing external challenges amid a cautious domestic policy environment. Navigating these headwinds will require balanced policy and structural reforms to restore trade resilience.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.

Updated 11/5/25