Economic Tendency Indicator points to much stronger economic growth than normal
The Economic Tendency Indicator, which summarises how consumers and firms view the economy, climbed from 106.7 in November to 110.1 in December, a level that points to much stronger economic growth than normal. Firms remain optimistic, with the manufacturing, construction and retail indicators all contributing to the increase, while the services indicator was unchanged. The consumer indicator also rose in December, but consumers remain slightly more pessimistic than normal about the economy.
Firms highly optimistic
The confidence indicator for the manufacturing industry climbed from 108.1 in November to 114.3 in December and signals a much stronger situation than normal. All of the components contributed to the increase: firms were more positive about both their order books and their stocks of finished goods, and stepped up their production plans for the next three months.
The construction trade also remains upbeat, with the confidence indicator for the building and civil engineering industry rising from 112.5 in November to 113.1 in December. This is the fourth successive month that the indicator has been above 110, which points to a much stronger situation than normal. Both components contributed to the rise: firms were slightly more positive about their order books, and the proportion of firms expecting an increase in their workforce over the next three months increased slightly further.
The confidence indicator for the retail trade climbed from 115.0 in November to 116.7 in December, which is much higher than the historical average. The increase was due to a higher proportion of firms reporting sales growth in recent months. This proportion is well above the historical average. Firms’ optimistic expectations for sales volumes over the next three months were unchanged. Nor was there any appreciable change in their assessment of whether their stocks of goods had changed notably from the previous month, which remains less negative than normal.
The confidence indicator for the private service sector was unchanged in December at 106.5, which is well above the historical average and signals a stronger situation than normal. The proportions of firms reporting demand growth over the past three months and an improvement in their operations were slightly lower, but the sector’s already relatively optimistic expectations for demand over the next three months climbed slightly further.
Consumers more upbeat
The consumer confidence indicator rose from 96.4 in November to 98.7 in December but remains below the historical average. Two of the components contributed to the increase: consumers’ view of the current state of the Swedish economy was less negative, and their expectations for the economy over the next year improved. Taken together, their assessment of the Swedish economy remains more pessimistic than normal, however. There were no notable changes in the other three components, namely consumers’ view of their personal finances now and in three months, and of whether now is a good time to make major purchases. Taken together, their assessment of their personal finances is more optimistic than normal, while their view of whether now is a good time to make major purchases is much more positive than normal.
For further information:
Maria Billstam, Head of Economic Tendency Surveys +46 8 453 59 04
Sarah Hegardt Grant, Head of Communications +46 8 453 59 11
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