Swedish economic activities still waxing on well but at a calmer pace: Riksbank


Saturday, 18 June 2011
The Swedish central bank or the Riksbank's company interviews in May 2011 show a continuing positive trend in demand and production in the Swedish economy but there are also indications that productivity is getting calmer. 

The companies interviewed consider that labour supply is good and that there is spare capacity. But there are signs that the growth rate declines is to come.

To meet rising costs, the companies intend to increase prices. Many export companies also point out that the current level of exchange rate is adversely affecting their profitability.


"The companies that participated in the Riksbank's company survey estimate that economic development is currently good. However, there are some signs that growth in the future will decrease. More and more companies now think of a slowdown in production and new orders in the coming quarter compared with the previous survey in January”, write the central bank.

While demand in the economy has continued to increase, the companies say that it is generally not difficult to find workers. They did not judge that technical production capacity is a constraint on further expansion. More companies than before, however, intends to increase their investments within the next six months, according to the report.

The greater is that many companies plan to implement price increases.
"It is mainly manufacturing and engineering related companies which see a need to raise prices to meet rising labour and input costs. Even the good demand situation facilitates price increases. Many export companies indicate that the current exchange rate hampers their profitability. The level of the Krona’s exchange rates creates a pressure to increase productivity and reduce costs, ”said the Riksbank.

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