Sweden Economic Confidence At 15-Month Low

(RTTNews) - Sweden's economic sentiment worsened to a 15-month low in June, while consumer confidence declined further to a record low on concerns over the impact of the Russia-Ukraine war, data from the National Institute of Economic Research showed on Wednesday.

The economic tendency indicator fell 4.4 points to 105.9 in June from 110.3 in May.

All sectors, except construction, contributed negatively to the headline index in June, with the consumer confidence index falling the most, by 5.8 points, to 65.5 from 71.3 in May.

The survey revealed that the latest consumer confidence is now lower than it was during the financial crisis.

The Swedish Economy report, published earlier by NIER, revealed that consumers were deeply pessimistic about the future on the backdrop of rampant inflation, dwindling asset prices and expectations of further increases in interest rates.

The low purchasing power of consumers indicates that demand will weaken, the economy will drop back below capacity, and unemployment will remain relatively high next year, the report said.

Due to the weaker economy and fewer Ukrainian refugees expected to come to Sweden this year and next, government consumption will grow at a slower pace, the NIER said.

The Swedish economy is expected to grow 2.0 percent in 2022 and 1.4 percent in 2023, the report said.

Inflation expectations for the next twelve months rose in June. The respective index climbed from 9.9 to 10.6.

The manufacturing industry confidence index fell to 120.6 in June from 125.0 in the preceding month.

The retail trade confidence index also weakened to 105.3 in June from 111.0 in the previous month.

Meanwhile, the measure of construction morale rose to 106.5 in June from 105.4 in May. This was due largely to firms reporting more optimistic employment plans than in May.