Finland benefits from Eurosystem’s securities purchases

Abstract

The effects of the Eurosystem’s expanded asset purchase programme (EAPP) are already visible on the financial markets. The achievements of the programme are, however, only intermediate goals from a central bank perspective, through which the effects of the programme can work through to the real economy and prices. To a small open economy such as Finland, the effects of the programme are transmitted particularly via lower market interest rates and a weaker exchange rate. According to calculations conducted at the Bank of Finland, the EAPP will stimulate Finland’s GDP growth by 0.2 of a percentage point and inflation by 0.3 of a percentage point in 2015.