60035
Fitch Voices Concern About Finnish Household Debt
Fitch Voices Concern About Finnish Household Debt

Fitch Voices Concern About Finnish Household Debt

Fitch Voices Concern About Finnish Household Debt

Fitch Ratings has called attention to the mounting debt burden of households in Finland. The credit rating agency reminds in its latest country review that the debt-to-income ratio of households rose to 125% in the second quarter of last year–a level that represents a 20 percentage point increase from ten years ago despite remaining below the levels in other Nordics.
Fitch estimates that the measures introduced to reduce the indebtedness of households in Finland, such as imposing minimum requirements on mortgage risk weights and gradually removing mortgage-related tax incentives, are steps in the right direction but not necessarily sufficient, NewsNow reported.
“Structural factors that feed into higher house prices in urban areas still support higher household leverage,” it points out.
Olli Rehn, a board member at the Bank of Finland, drew attention to the risks associated with household indebtedness last Tuesday. “The Finnish economy has now put recession behind it. A rapid increase in debt does not promote faster economic growth but entails the risk of over-indebtedness,” he warned.
Fitch Ratings, despite its concerns about household debt, affirmed its AA+ credit rating and stable outlook on Finland on February 17. It reminded, however, that the economic situation is likely to deteriorate in the second half of the year.
“Economic momentum will be sustained in the first half of 2017 but begin to fade slowly thereafter as a combination of tax and administrative measures reduce household income, thus hitting consumption, and there is a cyclical deceleration in investment,” it predicted.
“This will only partly be offset by a recovery in export growth tied to robust demand in key markets such as Germany and competitiveness gains from recent reforms.”

Short URL : https://goo.gl/Cv3f9q
  1. https://goo.gl/VPYXHi
  • https://goo.gl/5q0ZfN
  • https://goo.gl/KBdZK7
  • https://goo.gl/3mMk0e
  • https://goo.gl/bdduTZ

You can also read ...

Capital Economics forecasts Turkey’s GDP growth will fall to 3.5% in 2018 from 7.4% in 2017.
Expectations for Turkey's end-2018 inflation rate rose from 12...
Trump Tactics Sabotaging US Economy, Markets
Wall Street could be making a costly mistake. According to...
File photo of finance ministers and central bankers from the G20 nations.
Global economic growth is poised to pick up this year, though...
Apple Watch Smells Losses
The latest round of US tariffs on $200 billion of Chinese...
Italian Bonds, Stocks Fall
Italian bond yields rose and equities sold off on Friday after...
Technology Can Help Workers From the Informality Trap
Technology and what it will do to change how people work is...
Moody’s Warns Philippines of Downside Risk
Debt watcher Moody’s Investors Service on Friday said the...
A weaker yuan remains a source of risk for global currency markets.
The Chinese yuan slid to its lowest in more than a year on...

Add new comment

Read our comment policy before posting your viewpoints

Trending

Googleplus