Published : 40 mins ago, on 29/10/2024
STOCKHOLM (Reuters) – Sweden’s economy entered a technical recession in the third quarter as gross domestic product fell 0.1% compared with the previous quarter, preliminary figures from the statistics office showed on Tuesday.
Swedish GDP also declined in the second quarter. An economy is considered to be in recession when the economy has contracted for two consecutive quarters.
Compared to the same quarter a year earlier, gross domestic was down 0.1%.
Analysts had forecast the economy would expand by 0.4% in the July-September quarter from the April-June period and to grow by 0.7% compared to last year.
The preliminary data is likely to be revised when final figures are published.
In September, GDP expanded 0.1% compared to the same month last year, but fell 0.4% compared to August.
“Sweden’s gross domestic product decreased in September which together with weak development in July contributed to negative growth for the third quarter as a whole compared with the previous quarter,” Sweden’s statistics office said.
Sweden’s economy has been sluggish for the past year. At its most recent meeting in September, the Riksbank said it expected to cut the policy rate at the two remaining meetings this year – one of which could be a half percentage-point cut – and once or twice more in the first half of 2025.
“The Swedish economy remains stagnant,” Swedbank said in a note. “The outcome suggests a somewhat higher probability for a bigger move in November, and we stick to our call of a 50 point rate cut at the Riksbank’s policy meeting next week,” it said.
(Reporting by Johan Ahlander, editing by Terje Solsvik and Christina Fincher)