Sweden: GDP grows on stronger domestic demand
February 28, 2014
In the last quarter of 2013, the economy expanded 1.7% over the previous quarter in seasonally- and working-day adjusted terms, according to data released on 28 February. The figure overshot both the 0.5% expansion recorded in the third quarter and the 0.6% rise the market had expected. On an annual basis, the economy grew 3.1%, marking an improvement over the 0.7% expansion in Q3. In the full year 2013, the economy grew 1.5%, which was up from the 0.9% growth recorded in 2012.
Q4's result came on the back of improving domestic demand while the external sector deteriorated over the previous quarter. Private consumption rose 0.9% (Q3: +0.3% quarter-on-quarter), while government spending increased 0.8% (Q3: +0.3% qoq). In addition, fixed investment rose 1.0%, which was an improvement over the 0.8% rise recorded in Q3.
On the external side of the economy, exports of goods and services rose 0.7% in Q4 (Q3: +0.4% qoq). Imports swung from a 0.3% fall in the third quarter to a 0.8% increase in the fourth quarter. The external sector's net contribution to overall economic growth fell from 0.3 percentage points in Q3 to zero percentage points in Q4.
According to its February Monetary Policy Update, the Central Bank expects economic growth to reach 2.4% in 2014 and 3.6% in 2015. FocusEconomics Consensus Forecast panelists expect the economy to grow 2.4% in 2014, which is unchanged from last month's estimate. For 2015, the panel projects that the economy will expand 2.9%.
Author: Dirina Mançellari, Senior Economist