With this low and stable inflation, along with other important policy improvements, the peaks and valleys of the business cycle have become less pronounced, and the economy has shown increased flexibility in adjusting to various types of shocks.
Growth became gradually more robust and culminated in a 3 per cent expansion in 2017. However, growth has now decelerated to about 1 per cent. Yet, thanks to the falling unemployment, the labour market remains resilient and is keeping up domestic demand in Europe, e.g. in Finland.