Swedish GDP is forecast to grow by 2.9 percent this year, up from 2.4 percent in the previous forecast.
"There are good reasons for optimism. But developments in the labor market are slow. That is why we are raising a warning finger. It is important that economic policy does not tighten too quickly and slow down the recovery," says Torbjörn Hållö, LO's (the Swedish Trade Union Confederation) chief economist, in a press release.
LO points to a "slow decline" in unemployment, which is predicted to average 8.7 percent this year.
"Employment and labor force developments point to a slightly faster decline in unemployment next year," the forecast states.
