The index fell to 54.2 in July, compared with 56.5 the previous month.
"The service economy lost momentum in July but has strengthened over the year after a sluggish first quarter. Service companies are still holding off on hiring new employees," says Jörgen Kennemar, responsible for the analysis of the Purchasing Managers' Index.
The composite index for July, which also includes manufacturing, fell to 54.7 compared with 56.9 in June.
"The recovery in the business sector continues but slowed in July, while cost pressures have eased, which should be positive news ahead of the Swedish Central Bank's interest rate decision later in August," says Jörgen Kennemar.
An index figure above 50 indicates growth, while a figure below 50 indicates decline.
