The USA's new global shock tariffs are unequivocally negative for the world economy, according to Erik Thedéen, who believes that the tariffs were larger than expected.
We know that tariffs lead to worse growth and higher inflation, primarily in the USA. We are already seeing fairly large movements on the financial market, he says.
Are prepared
He continues to say that the Swedish economy is fairly well-equipped to meet the challenge with a strengthened krona.
But we are an export-dependent country and that is not good for companies. Export to the USA will become more expensive and it will be less competitive to operate on the American market.
The announced tariffs will not immediately affect the Swedish Central Bank's actions. According to Thedéen, inflation can be affected in both directions.
If the economy goes worse, it can dampen demand pressure and thus inflation pressure. But it is too early to say yet if it will affect interest rates.
The krona has strengthened, and Sweden is one of the countries in Europe that is best equipped to meet the change, he believes.
- We have stable public finances and functioning institutions, and we have high credibility in the inflation target, so we enter this in a fairly good position. But it is not good for the economy and not good for individual companies, primarily not for confidence in the American economy.
Can adjust
He emphasizes that the business sector is dynamic and, for example, during the pandemic, Sweden showed that it can adjust.
The direct effects on the Swedish economy are small. Then it's about what happens in the boardrooms of the large Swedish companies, and we don't know that. There is no hard data today indicating a collapse.
