After declining by 0.3% in the spring, economic activity in Sweden fell again by 0.1% this summer. The country is officially in a recession. On an annual basis, GDP is growing at a negative 0.1%.
However, these preliminary figures should be taken with caution. They are often revised, and this may still be the case with those of the third quarter. In any event, economic dynamism in Sweden is weak at best, with stagnant household consumption and an industry that is being battered as elsewhere in Europe.
In response to this situation, the Swedish central bank has already decided to reduce the key rate at the last two monetary committees scheduled for this year and will continue monetary easing in the first half of 2025.
This should restore momentum to domestic demand next year and allow for a recovery in economic activity. However, the outlook is too weak to warrant an investment.
