Swedish growth was lower than what the Swedish Central Bank calculated with during the first half of 2025, but now Riksbank Governor Erik Thedéen sees signs that it is starting to turn.
There are signs of stronger growth, he says at an hearing in the Riksdag's Finance Committee.
As an example, Thedéen mentions, among other things, a stronger GDP growth and that household consumption is increasing, especially when it comes to durable goods, which have increased by 8 percent in annual terms.
Early signs
They are early signs, but I think we can say that there is a certain optimism in consumption, he says to TT after the hearing.
What suggests that households will consume and not just continue to save when they get more in their wallet?
It's no law of nature, but we see that disposable incomes are now higher than they were before the inflation surge, so you simply have more purchasing power. You get more goods for the money, more restaurant visits for the money, or whatever you want to consume.
It should indicate that you now have the opportunity to put some on increased consumption.
Other signs of a brightening are that companies' confidence in the economy is now at "normal levels" and that production in the business sector has increased.
A risk to the economy, however, is that the Swedish labor market is still weak.
Unemployment has risen in almost all groups, says Thedéen, and continues:
Perhaps we see signs of a stabilization.
When the economy improves, the Swedish Central Bank expects unemployment to eventually decrease.
"Best assessment"
At the latest rate meeting in September, the Swedish Central Bank lowered the interest rate by 0.25 percentage points to 1.75 percent.
Our picture is that inflation is on its way down towards 2 percent, we feel safe with that, that's why we also lowered the interest rate, says Thedéen.
According to Thedéen, it is the Swedish Central Bank's "best assessment, which is still very uncertain" that the interest rate will remain at that level for a while.
The big message is that we think we have lowered clearly, we think we have reached a level that we can stay on for a while, and then we have to constantly evaluate.