Sweden: Economic sentiment remains elevated in October
October 27, 2017
The economic tendency indicator dipped slightly from 113.8 in September to 113.3 in October, according to the National Institute of Economic Research (NIER), marking the seventh successive month above 110.0. Values above 100.0 indicate stronger growth than normal, while values above 110.0 indicate much stronger growth than normal.
October’s slight dip was driven by less optimistic sentiment in the manufacturing sector, which had risen to an all-time high in the prior month. However, manufacturing firms still remain very positive regarding order books, and reported greater production capacity. The building and civil engineering, retail trade and private service sectors grew more optimistic, with all three above the 100.0 mark. On the downside, the private service sector reported that labor shortages were hampering growth. This is a problem recently flagged up by the Central Bank, and is being driven by higher employment coupled with matching problems in the labor market.
Consumers became substantially more optimistic about the economic outlook compared to September, and reported higher expectations for inflation in 12 months.
Author: Oliver Reynolds, Economist