Swedish economic growth for 2024 revised down

HELSINKI, Aug. 7 (Xinhua) — The Swedish National Institute of Economic Research has revised down its forecast for the country’s economic growth in 2024 to 0.7 percent from its previous projection of 0.9 percent in June.
In a press release issued Wednesday, the Institute predicted a recovery to start later this year, noting that the real value of wages has begun to increase again thanks to the decline of inflation, which is expected to drop to 1.8 percent this year.
However, the labor market suffers a persistent low cycle. The unemployment rate during the second quarter reached its highest level in 10 years of 8.3 percent. The jobless rate for the entire year is projected to average 8.2 percent.
The Institute, a government agency operating under the Ministry of Finance, urged the Bank of Sweden to reduce key interest rates faster than expected. The Bank of Sweden had earlier indicated that the rates would go down to 2.25 percent next summer.
“The (prospects) of declining interest rates have created optimism,” said Ylva Heden Westerdahl, the director for forecasts, at a press conference on Wednesday. “But the pace of the recovery depends, however, on the realization of the optimistic expectations.” ■