Finland’s industrial output declined by -1.80% year-over-year in November 2025, according to the latest release from the Sigmanomics database. This result missed the market estimate of 0.90% and improved modestly from October’s steep contraction of -2.60%. The data covers the entire Finnish manufacturing and production sector, reflecting the country’s industrial health amid a complex macroeconomic environment.

Geographic & Temporal Scope

The data reflects Finland’s nationwide industrial production trends, capturing manufacturing, mining, and utilities output. The YoY basis smooths seasonal volatility, providing a clearer view of structural shifts. Over the past 12 months, Finland’s industrial production has fluctuated sharply, with peaks of 7.80% in May and troughs near -4.20% in September, highlighting ongoing instability.

Core Macroeconomic Indicators

Industrial production is a key driver of GDP growth and employment in Finland. The recent contraction aligns with subdued manufacturing PMI readings (~48.50 in October) and weakening export orders. Inflation remains sticky above 3%, pressuring real incomes and dampening domestic demand. The unemployment rate held steady near 6.50%, but sector-specific layoffs in manufacturing have increased.

Monetary Policy & Financial Conditions

Finland’s industrial output decline coincides with the European Central Bank’s (ECB) recent rate hikes, pushing the main refinancing rate to 4.50%. Tighter financial conditions have increased borrowing costs for manufacturers, constraining capital expenditures. Credit spreads widened by 15 basis points in November, reflecting risk aversion. The euro (EUR) has strengthened 1.20% against the USD since October, impacting export competitiveness.

Fiscal Policy & Government Budget

Fiscal policy remains moderately contractionary as Finland targets deficit reduction post-pandemic. The government’s 2025 budget projects a 1.80% GDP deficit, with limited stimulus for industrial sectors. Energy subsidies were scaled back in Q3, raising operational costs for energy-intensive industries. Public investment in infrastructure is steady but insufficient to offset private sector weakness.

External Shocks & Geopolitical Risks

Global supply chain disruptions persist, particularly in semiconductors and raw materials critical to Finnish manufacturing. Geopolitical tensions in Eastern Europe and trade frictions with China add uncertainty. Energy price volatility, especially natural gas, has increased input costs. These external shocks weigh heavily on industrial production resilience.

Drivers this month

• Energy-intensive sectors contracted by -3.20% YoY due to higher input costs.
• Electronics manufacturing showed a modest 1.10% YoY gain, supported by export orders.
• Metal production declined -2.50% YoY amid weaker global demand.

Policy pulse

The current reading remains below the ECB’s 2% inflation target zone, highlighting subdued industrial momentum. The contraction suggests that monetary tightening is weighing on production, with no immediate sign of rebound. The data supports a cautious stance from policymakers regarding further rate hikes.

Market lens

Immediate reaction: The EUR/USD slipped 0.15% in the first hour post-release, reflecting disappointment. Finnish 2-year government yields rose 5 basis points, signaling increased risk premia. The OMX Helsinki 25 index declined 0.80%, led by industrial stocks.

Bullish Scenario (20% probability)

Supply chain normalization and easing energy prices could spur a rebound in industrial output, pushing growth above +2% YoY by mid-2026. Stronger global demand, especially from the EU and Asia, would support exports. Fiscal stimulus focused on green technologies may accelerate investment.

Base Scenario (55% probability)

Industrial production remains subdued but stable, fluctuating between -1% and +1% YoY through 2026. Monetary policy remains restrictive but avoids overt tightening. External shocks moderate but geopolitical risks persist. Gradual improvement in manufacturing PMI supports a slow recovery.

Bearish Scenario (25% probability)

Prolonged geopolitical tensions and renewed supply disruptions deepen the contraction to -3% YoY or worse. Energy prices spike again, and credit conditions tighten further. Fiscal austerity intensifies, and global demand weakens, leading to job losses and investment pullbacks.

Structural & Long-Run Trends

Finland’s industrial sector faces long-term challenges including automation, decarbonization, and global competition. The shift toward high-tech manufacturing and sustainability investments may dampen short-term output but improve productivity. Demographic pressures and labor shortages also constrain growth potential.

Finland’s November 2025 industrial production data reveals a sector under pressure but showing tentative signs of stabilization. The -1.80% YoY contraction, while disappointing, is less severe than prior months. Monetary tightening, fiscal restraint, and external shocks remain key headwinds. However, structural reforms and potential easing of global tensions offer upside potential.

Investors and policymakers should monitor incoming data closely, especially PMI trends, energy prices, and geopolitical developments. The balance of risks leans slightly to the downside, but a measured recovery is plausible if key constraints ease. The Sigmanomics database will continue to provide valuable real-time insights into Finland’s industrial trajectory.

Key tradable symbols linked to Finland’s industrial production dynamics include STEAV (steel sector exposure), EURUSD (currency impact on exports), NOKIA (technology manufacturing), BTCUSD (risk sentiment proxy), and EURSEK (regional trade dynamics).