Swedish economic sentiment falls in February, but remains elevated
Source: FxWire Pro - Commentary / 27 Feb 2018 09:26:55 Eastern Standard Time
Swedish economic sentiment dropped in February, but it continued to be elevated. There are certain signs of a more divided economy; with booming manufacturing and decelerating domestic economy. The Economic Sentiment Indicator came in at 110.1 in the month of February, as compared with January’s 110.2 and consensus expectations of 110.0. The consumer confidence index fell markedly with most pronounced drop in the micro index while the macro-index fell marginally. The consumer sentiment index dropped to 104.7 from 107.2, as compared with consensus expectations of 107.0.
Markedly, employment plans in the business sector dropped notably, reaching its lowest level since July 2016. Employment plans dropped in all sectors, particularly in the service sector. Sentiment in the construction sector also dropped in the month, falling from 109.5 to 10.6.2. But underlying sub-index did not fall that much. Therefore, no alarming signals from the construction sector in the NIER survey, noted Nordea Bank.
Meanwhile, manufacturing firms continued to be positive with the overall indicator rising slightly from an elevated level. The manufacturing confidence index rose a bit to 114 from 113.8. Consensus expectations were for the index to have fallen to 113. The sector is advancing from the global upswing in manufacturing and the subdued SEK.
Households’ inflation expectations rose to 2.8 percent in February from 2.6 percent in January. Retailers’ price plans rose further in the month.
“All in all, the ESI indicator remains high, roughly as expected. There are some signs of a more divided economy with a booming manufacturing sector and a slowing domestic economy”, stated Nordea Bank.
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