Economic Tendency Survey March 2024

Consumers more optimistic about the future

The Economic Tendency Indicator climbed 2.4 points in March from 90.7 to 93.1. The consumer and service indicators improved most, while only the construction indicator fell. The share of firms anticipating a rise in selling prices was largely unchanged from February across the business sector as a whole, but increased again in the service sector after dropping back to normal levels in February.

The confidence indicator for the manufacturing industry improved slightly but remains somewhat weaker than normal. There are, however, variations between segments. For example, sentiment is comparatively strong among food producers, but much weaker than normal among machinery producers.

The confidence indicator for the building and civil engineering industry fell 2.1 points to 92.6 and shows weaker sentiment than normal. A decrease in employee numbers over the past three months was widely reported. Employment plans are also deeply pessimistic, with comparatively many firms expecting their workforce to shrink over the next three months.

The confidence indicator for the retail trade rose but remains below the historical average. Having risen for four consecutive months, it has now staged a significant recovery after the sharp decline in 2022.

The confidence indicator for the service sector was the most improved of the business sector indicators in March, climbing 3.1 points to 93.8. The increase stemmed from both expectations for demand over the next three months and firms’ view of their performance over the past three months.

The consumer confidence indicator climbed 4.5 points to 87.5. Despite rising for six straight months, the indicator is still at a low level and shows much weaker sentiment than normal. There is an unusually large gap between forward-looking and backward-looking questions, especially when it comes to consumers’ view of the Swedish economy. Consumers are optimistic about the outlook for the economy over the next 12 months, but much more negative than normal about its performance over the past 12 months.