Still weak sentiment

The Economic Tendency Indicator edged up in September to 94.9 and continues to show weaker sentiment than normal. Sentiment has been comparatively stable since April, with the Economic Tendency Indicator largely unchanged. The consumer confidence indicator has risen for 12 consecutive months and now shows a normal situation.

The confidence indicator for the manufacturing industry fell 2.4 points to 94.2, which means that sentiment can be considered weaker than normal. Firms reported a further decline in orders from both the domestic market and the export market, with export orders well below normal.

The confidence indicator for the building and civil engineering industry fell 2.5 points to 95.4 and shows weaker sentiment than normal. Unlike in the rest of the business sector, construction firms’ pricing plans previously pointed to reductions. Pricing plans in the industry are now positive for the first time in two years, with a larger proportion of firms than normal expecting prices to rise in the next three months.

The confidence indicator for the retail trade climbed 3.7 points to 105.6, making it by far the most upbeat part of the business sector. The indicator has trended up since bottoming out just below 80.0 in spring 2023, and has not been as high since May 2022.

The confidence indicator for the service sector rose but still shows weaker sentiment than normal. The improvement came mainly from the question about demand over the past three months. Service firms’ expectations for demand were well below normal for nearly two years but have been largely in line with the historical average for the past six months.

The consumer confidence indicator climbed 2.5 points in September to 99.5. There were improvements in both the micro index summarising consumers’ view of their own finances and the macro index summarising their view of the Swedish economy. The macro index is above the historical average, while the micro index is still lower than normal.