Economic Tendency Survey September 2020

Manufacturing pulls up overall sentiment

One of the effects of the COVID-19 pandemic was a sharp fall in firms' sales. This means that positive signals from firms should be interpreted with care, as the improvement is from extremely low levels.

The Economic Tendency Indicator rose for a fifth month in September, climbing 6.9 points to 94.5. All industries except construction contributed to the improvement.

The confidence indicator for the manufacturing industry gained 6.9 points in November and is now almost 6 points above the historical average. The increase was due primarily to more positive production expectations but also to firms’ assessment of their current order books.

The confidence indicator for the building and civil engineering industry fell 4.4 points. It is the only indicator that did not strengthen in September and shows very weak sentiment.

The confidence indicator for the retail trade gained 7.5 points, thanks to increasing optimism about sales volumes. Firms’ view of their current stocks also contributed to the improvement.

The confidence indicator for the service sector climbed 7.5 points to 86.5 but still shows a very weak situation. The increase was a result of firms being less negative about their business and demand for their services. Expectations for future sales also contributed to the improvement.

The consumer confidence indicator rose again in September but still points to much weaker sentiment than normal. Households were more positive about their personal finances and more upbeat about the Swedish economy, especially over the coming year.