Swedish economic sentiment indicator rises in April

The Swedish economic sentiment indicator rises in April. The NIER April Tendency Survey showed that the Economic Sentiment Indicator rose 0.8 points to 102.7 in April, while companies’ employment plans dropped down.

The consumer sentiment rose to 95.8 but remains below its historical average, indicating sluggish consumption growth. A positive sign is that consumers are more optimistic on households’ economic situation of 100.8, while they are still negative regarding the Swedish economy. Sentiment in the total business sector was stable at 101.7. Manufacturers became more optimistic, with sentiment at 108.4, whereas the sentiment for private services came in at 98.8.

Employment plans dropped, suggesting that the sluggish employment trend will continue. Labor shortage fell, implying lower resource utilization. Retailers’ price plans dropped, but from a high level. Household’s inflation expectations were up 3.4 percent from 3.1 percent in March.

Overall, the survey was a mixed bag. Manufacturers became more positive while domestic oriented sectors continued to be rather gloomy. The fall in employment plans is a concern, and there is a risk for further fall given the subdued domestic demand, said Nordea Bank in a research.