Scandinavia’s biggest economy has seen both consumer and business confidence decline for a fourth month in a row, Bloomberg reports on August 29.
Stockholm’s National Institute of Economic Research (NIER) stated that their Economic Tendency Indicator fell to 94.9 in August from 96.4 the previous month. Bloomberg economists had previously estimated a median of 96 in a recent survey.
This strengthens the case that the global economic slowdown and a looming recession have arrived in Sweden. This month it joined a host of other nations selling 10-year bonds at a negative yield, at the time of writing they are now trading at -0.367%. Resulting in the bizarre situation of short-term bondholders expecting better returns than long-term ones.
Economists generally are now revising their outlook for growth in the Nordic nation, with both Swedbank and SEB cutting their GDP forecasts.
SEB’s Olle Holmgren stated the NIER index indicates “a downside risk for our growth forecasts. The survey still signals growth but is getting close to recessionary levels.”
Handelsbanken’s Johan Lof has ruled out an immediately imminent recession but observed a “risk of a deepening and widening cool-down.”