Sweden Economic Forecast

Sweden Economic Outlook

October 26, 2021

Economic activity looks likely to have picked up in Q3 overall, although available data raises concerns of a stalling recovery. While GDP grew at a robust rate in July, it contracted sharply in August as household consumption declined and the external sector dragged on activity. Supply chain bottlenecks have inhibited production, leading to a fall in the value of exports in August, resulting in the first trade deficit in a year and the largest such shortfall in five years. However, PMI readings for both the manufacturing and services sectors rose further into expansionary territory in September, suggesting a more positive end to the quarter. Meanwhile, in politics, Finance Minister Magdalena Andersson will replace outgoing PM Stefan Löfven as leader of the Social Democrats in November, putting her on course to become the country’s first female prime minister.

Sweden Economic Growth

The economy is projected to expand at a healthy rate this year, before growth slows slightly in 2022. Lower private consumption growth will drive the mild slowdown, while a normalization of global trade dynamics will see export growth fall considerably. Pandemic-related uncertainty and supply chain disruptions remain key risks to the outlook. FocusEconomics panelists see GDP expanding 3.4% in 2022, which is unchanged from last month’s forecast, and 2.0% in 2023.

Sweden Economy Data

2015 2016 2017 2018 2019
Population (million)9.910.010.110.210.3
GDP per capita (USD)51,28751,60053,49354,25651,431
GDP (USD bn)505516541555531
Economic Growth (GDP, annual variation in %)4.52.12.62.01.2
Consumption (annual variation in %)3.92.32.61.81.2
Investment (annual variation in %)6.94.05.51.4-1.3
Exports (G&S, annual variation in %)5.82.44.14.23.2
Imports (G&S, annual variation in %)6.14.54.73.81.1
Industrial Production (annual variation in %)2.92.24.73.21.2
Retail Sales (annual variation in %)5.02.92.11.52.4
Unemployment Rate7.46.96.76.36.8
Fiscal Balance (% of GDP)0.01.01.40.80.5
Public Debt (% of GDP)43.942.240.838.835.1
Money (annual variation in %)8.27.27.26.67.1
Inflation Rate (CPI, annual variation in %, eop)0.11.71.72.01.8
Inflation Rate (CPI, annual variation in %)0.01.01.82.01.8
Inflation (PPI, annual variation in %)0.0-0.95.26.63.0
Policy Interest Rate (%)-0.35-0.50-0.50-0.500.0
Stock Market (annual variation in %)-1.24.93.9-10.725.8
Exchange Rate (vs EUR)9.369.479.6410.2610.58
Exchange Rate (vs EUR, aop)9.179.589.8410.1610.50
Current Account (% of GDP)4.13.53.12.54.2
Current Account Balance (USD bn)20.618.316.614.022.3
Trade Balance (USD billion)14.211.011.311.118.5

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Sweden Facts

Value Change Date
Bond Yield0.15-4.79 %Jan 01
Exchange Rate9.36-0.20 %Jan 01

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