Forex »

Increase In Swedish Retail Sales

James Boston
Share on StockTwits
Published on
www.finances.com
Increase In Swedish Retail Sales

It is too early to expect to see signs of a pick up in the Swedish economy following last month’s surprise interest rate cut by the central bank of 50 basis points to just 0.25%. The Riksbank has been battling persistent deflation over the past two quarters and the despite the a series of rate reductions it has so far failed to stimulate any lasting price growth activity.

Data published this morning however may offer some insight into any changing conditions that might be emerging in the economy. The headline figures today are the Retail Sales numbers, year on year the figure for the month of June has been reported as 3.3%, this is in comparison to the 3.0% level experienced in May and a market consensus estimate for 4.5% in June. Month on month the Retail Sales figure is showing an increase of 0.5%, this is in contrast to the previous month’s contraction of -0.7%, the markets had been anticipating today’s Retail Sales number to show 0.4% growth.

The Swedish Balance of Trade remains in surplus, the June data released this morning shows a SEK 5.2BN positive trade balance for the country. This is a pick up on last month’s reported SEK 0.2BN surplus, the market consensus estimate for Sweden’s June trade balance was SEK 3.5BN.

Sentiment in Sweden is also showing more positively, the figures released today relate to the month of July and therefore should capture the full effect of the rate cut last month. Consumers are borrowing more as evidenced by the rise in Swedish Household Lending, this measure has picked up from 5.30% last month to today’s reading of 5.40%. Actual Consumer and Business Confidence numbers are due early next week and markets are expecting these to show a pick up as the rate cut translates into a more positive sentiment in the economy.

Share on StockTwits