STOCKHOLM (Reuters) -Sweden's economy is picking up speed after a period of sluggish growth, but uncertainty remains high, Finance Minister Elisabeth Svantesson said on Wednesday. "You can say that
Sweden's Finance Minister Highlights Economic Recovery Signs
Overview of Sweden's Economic Recovery
STOCKHOLM (Reuters) -Sweden's economy is picking up speed after a period of sluggish growth, but uncertainty remains high, Finance Minister Elisabeth Svantesson said on Wednesday.
Consumer Spending Trends
Svantesson said that consumers were beginning to start spending after a series of rate cuts by the central bank, while both industry and the household sector are more positive.
GDP Growth Projections
"It's not that it's very bright, but there is a light there at the end of the tunnel," she told a press conference.
Inflation Concerns and Central Bank Policies
The Swedish economy has struggled this year and households remain cautious about spending, despite real wage growth and eight rate cuts since spring 2024.
Other than house-builders, who are still struggling, "sentiment in Swedish business is more positive and better than normal," said Svantesson.
In the third quarter, GDP growth was however faster than expected at 1.1% from the previous quarter, according to an October 29 flash reading.
The right-wing government's budget for 2026 is the country's most expansive since the pandemic, aiming to boost households and speed up growth ahead of a general election in September.
The government expects GDP to increase 3.1% next year.
Svantesson said she was not worried that stronger growth would lead to a pick up in inflation, which is currently above the central bank's 2% target.
"It (inflation) has come in a bit higher for a number of understandable reasons, but it isn't high and I don't expect our budget, for example, to push up inflation," she said.
Flash inflation figures for October showed headline consumer prices rose 3.1% from the same month a year ago. Stripped of volatile energy prices, inflation was 2.8%.
The central bank kept its key rate on hold earlier this month at 1.75% and said the easing cycle, which started in spring last year, was now over.
Analysts expect the next move to be a hike, probably in spring 2027.
(Reporting by Anna Ringstrom and Simon Johnson, editing by Terje Solsvik and Alexander Smith)
