2021-03-31

Swedish Economy Report March 2021

Swedish Economy Report

A second wave of infections and tighter restrictions caused the economic recovery in Sweden to stall in the fourth quarter last year. Extended restrictions and a third wave of infections have also brought subdued growth in the first quarter this year.

The recovery will gradually get going again in the second quarter, despite production in parts of the manufacturing industry being held back by supply issues. In the third quarter, once almost all adults have been offered a vaccine and infection rates are lower, household consumption will rise rapidly and the economy will take a clear turn for the better. The economy will nevertheless operate well below capacity in 2021, and unemployment will still be well above 8 per cent at the end of the year. Despite very substantial unfunded measures this year, public finances remain strong. Should the economy perform worse than forecast, there is still considerable scope to support it further with public funds


2020

2021

2022

2023

2024

2025

GDP, market prices

–2.8

3.7

3.4

2.0

1.9

1.7

GDP per capita

–3.7

2.9

2.6

1.3

1.2

1.1

GDP, calendar-adjusted

–3.1

3.6

3.4

2.2

1.9

1.9

GDP, world

–3.6

5.5

4.0

3.3

3.2

3.2

Current account balance1

5.4

5.5

5.0

4.6

4.0

3.6

Hours worked2

–3.8

2.5

2.9

1.2

0.8

0.7

Employment

–1.3

–0.7

1.5

1.2

0.7

0.7

Unemployment3

8.3

8.6

7.7

7.1

7.0

7.0

Labour market gap4

–4.5

–2.7

–0.6

–0.1

0.0

0.0

Output gap5

–4.0

–2.3

–0.5

–0.1

0.0

0.0

Hourly wages6

2.0

2.6

2.3

2.5

3.0

3.2

Hourly labour costs2,7

3.8

1.2

2.3

2.8

3.0

3.2

Productivity2

0.5

1.2

0.5

1.0

1.1

1.2

CPI

0.5

1.6

1.4

2.2

2.2

2.5

CPIF

0.5

1.8

1.5

2.1

2.0

2.0

Repo rate8,9

0.00

0.00

0.00

0.00

0.25

0.50

Ten-year government bond rate8

0.0

0.5

0.8

1.2

1.5

1.8

Krona index (KIX)10

118.5

114.4

114.6

114.5

114.4

114.7

Government net lending1

–3.3

–2.1

–0.6

0.3

0.3

0.4

Structural net lending11

–1.2

–1.0

–0.3

0.3

0.3

0.3

Maastricht debt1

40.5

38.9

36.1

34.1

33.3

32.7

  1. Per cent of GDP.
  2. Calendar-adjusted. 
  3. Per cent of labour force.
  4. Difference between actual and potential hours worked in per cent of potential hours worked.
  5. Difference between actual and potential GDP in per cent of potential GDP.
  6. According to the short-term earnings statistics. 
  7. Refers to the hours of employees
  8. Per cent.
  9. At year-end. 
  10. Index 18 November 1992=100. 
  11. Per cent of potential GDP.

Sources: IMF, Statistics Sweden, National Mediation Office, Sveriges Riksbank, Macrobond and NIER.