”At the same time, Swedish households have been restrained for a long period in increasing consumption. As households increase their consumption going forward, the economy is expected to start recovering”, KI writes in a press release where they present the economic situation for June 2025.
KI assesses that the low economy and the subdued inflation figures will cause the Swedish Central Bank to lower the interest rate twice this year and land at 1.75 percent. This provides further help to the recovery in the economy. Next year, they believe that inflation will be below two percent.
In the labor market, the upturn takes a little longer. Employment is not expected to increase until next year and unemployment will remain elevated at the end of 2025.
Sweden's GDP is expected to grow by only 0.9 percent in 2025, largely due to a weak first half of the year. In 2026, they expect GDP development of 2.7 percent.
