Economic Tendency Survey January 2023

Manufacturing sentiment deteriorates further

The Economic Tendency Indicator fell 2.7 points in January from 85.0 to 82.3. Falls in the manufacturing and construction indicators mean that all the sector indicators are now below 100 and so below the historical average.

The confidence indicator for the manufacturing industry has fallen for eight straight months and is now marginally below 100. The decrease in January was due mainly to larger stocks and firms’ view of their order books.

The confidence indicator for the building and civil engineering industry fell 5.1 points to 96.1 due to housebuilders’ view of their order books. Builders have not been this pessimistic about the market outlook a year ahead since 1992.

The confidence indicator for the retail trade climbed 3.5 points to 78.6, but this is still the sector with by far the weakest sentiment. The improvement was due to smaller stocks and slightly less negative sales developments in recent months.

The confidence indicator for the service sector fell 1.7 points to 85.8 and continues to show very weak sentiment.

The consumer confidence indicator climbed crept up 0.9 points to 56.3. The macro index summarising consumers’ view of the Swedish economy edged down to 77.3, while the micro index summarising their view of their own finances rose 2.9 points to 48.7. While the gap between the two indices has narrowed slightly, there is still a significant difference in how consumers view their own situation and the country’s situation.