Swedish economy continues to falter and now measures are required from both the Swedish Central Bank and politically, believe the two major banks Swedbank and SEB, which this morning released new economic reports. The assessments are similar although SEB only believes in an interest rate cut.
Both banks predict a continued sluggish Swedish economy where households hold back.
Support is needed to get growth going, says Mattias Persson.
75 billion
He believes that the government's autumn budget, which is not yet fully negotiated, will include as much as 75 billion kronor in unfunded initiatives. This is historically unusually much.
Increased child benefits, reduced income taxes, extended ROT deduction. More than half of all these 75 billion will go to support households, he believes.
His assessment is thus that both the government and the Swedish Central Bank will stimulate the economy properly.
But the question is whether even that will be enough, according to Persson.
I would clearly think that one of them may need to do even more.
”Households in focus”
SEB makes roughly the same assessment of the government's upcoming budget for 2026.
”With great probability, households will be in focus ahead of the election year 2026 and the greatest emphasis on households with low and medium incomes. Another job tax deduction, reduced tax on pensions and an extension of the ROT deduction seem most likely. Compared to the budgets of the past few years, more focus will likely also be directed towards increased benefits”, says SEB's chief economist Daniel Bergvall in a press release.
