Swedish Economy Unexpectedly Shrinks on Weaker Spending

Sweden’s economy unexpectedly contracted in April, as weaker consumer spending dampened the largest Nordic economy’s rapid recovery from the pandemic.

Gross domestic product shrank 1.4% from the previous month, according to preliminary data from Statistics Sweden. Analysts polled by Bloomberg expected a 0.3% expansion.

Sweden has enjoyed a rebound driven by manufacturing and exports, and its economy expanded by 0.8% in the first three months of the year. Through most of April, Sweden saw the number of confirmed Covid-19 cases rising, and ICU beds filling ups. Since then, cases have gone down and pressure on the health care system has eased considerably.

Household consumption shrank 5.1% in the month, following a revised 0.7% gain in March, the statistics office said. Still, consumption is expected to pick up pace after the country started easing restrictions to contain coronavirus transmission on June 1.

©2021 Bloomberg L.P.

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