The Swedish economy grew by 2.6 percent in the third quarter compared to the same quarter last year, according to Statistics Sweden's (SCB) more definitive estimate. This was well above the preliminary estimate of GDP growth of 2.4 percent, which even then surprised economists.
“Woke up to life”
The recovery has started and there is a broad upswing in the third quarter. It is also important that domestic demand has come to life, says Isaksson.
And the indicators so far also point to growth continuing in the current quarter, albeit at a somewhat slower pace, according to the Nordea analyst. This is even though retail sales fell in October compared to a year ago, according to special Statistics Sweden statistics also released this morning.
This means that the window for a further interest rate cut from the Riksbank has probably completely closed, believes Isaksson.
The economy has started to recover. This suggests that the Riksbank is holding steady at 1.75 percent.
Low inflation
He sees no risk that the economy will gain too much momentum next year, when the government's tax cuts and lower food VAT take effect, so that the Riksbank will need to raise the interest rate instead.
He points out that inflation for next year still looks to be low, and mentions, among other things, low global price pressure and a strengthened krona.
