Sweden’s economy entered a technical recession in the third quarter as gross domestic product fell 0.1 per cent from the previous quarter, preliminary data from the statistics office showed on Tuesday.
Sweden’s GDP also declined in the second quarter. An economy is considered to be in recession if it has contracted for two consecutive quarters. Compared with the same quarter a year earlier, gross domestic product fell 0.1 per cent.
Analysts had forecast the economy would grow 0.4 per cent in the July-September period from April to June and 0.7 per cent from a year earlier. The preliminary data is likely to be revised when the final figures are released.
GDP rose 0.1 per cent in September from the same month last year, but fell 0.4 per cent from August. Sweden’s statistics office said:
Sweden’s gross domestic product decreased in September which together with weak development in July contributed to negative growth for the third quarter as a whole compared with the previous quarter.
Sweden’s economy has been sluggish in the past year. At its last meeting in September, the Riksbank said it expects to cut the discount rate at its two remaining meetings this year – one of which could be accompanied by a half-per-cent cut – and once or twice more in the first half of 2025.
Swedbank said in a report:
The Swedish economy remains stagnant. The outcome suggests a somewhat higher probability for a bigger move in November, and we stick to our call of a 50 point rate cut at the Riksbank’s policy meeting next week.
