Oct. 6 (Bloomberg) -- Finland’s economic growth will slow and a recession is possible if Europe’s debt crisis spirals out of control, Aktia Oyj said.
Gross domestic product will expand 2.8 percent this year and 1.4 percent in 2012, Aktia said, cutting its forecasts from 3.8 percent and 2.4 percent respectively. The likelihood of a recession in Europe is “high” at 40 percent, Chief Economist Timo Tyrvaeinen wrote in an e-mailed report today.
“If the debt crisis becomes unmanageable, we’re headed for a banking crisis,” Tyrvaeinen said. “A recession caused by freezing credit markets and lack of confidence will most likely be deep.”
To contact the reporter on this story: Kati Pohjanpalo in Helsinki at firstname.lastname@example.org
To contact the editor responsible for this story: Tasneem Brogger at email@example.com