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SWEDEN: Consumption Doesn’t Appear To Be Behind The Weak Flash Q3 GDP

SWEDEN
CEEMEABulletSwedenGlobalFixed Income BulletsForeign Exchange BulletsRegionMarkets

Although the Swedish household consumption indicator fell 0.3% M/M in September, consumption still rose 1.0% on a 3m/3m (i.e. quarterly) basis. This suggests other GDP components were behind the weaker-than-expected flash Q3 GDP print of -0.1% Q/Q (vs 0.3% cons, 0.2% Riksbank Sep MPR).

  • Full details of the Q3 GDP print will have to wait until the final release on Nov 29.
  • The household consumption indicator was buoyed by growth in retail trade of clothing and footwear, telecommunications and recreation and culture goods/services.
  • The Riksbank expects consumption to drive an economic recovery next year, with interest rates transmitting quickly through the household cash flow (i.e. mortgage) channel.
  • Services production was strong for a second month in September at 1.1% M/M (vs 2.0% prior), while industrial production was 1.2% M/M (vs 0.7% prior).
  • However, the volatile industrial orders series fell 3.6% M/M after a strong 4.3% prior). Overall, this suggests underlying manufacturing demand remains weak, likely weighing on Q3 investment spending.
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Although the Swedish household consumption indicator fell 0.3% M/M in September, consumption still rose 1.0% on a 3m/3m (i.e. quarterly) basis. This suggests other GDP components were behind the weaker-than-expected flash Q3 GDP print of -0.1% Q/Q (vs 0.3% cons, 0.2% Riksbank Sep MPR).

  • Full details of the Q3 GDP print will have to wait until the final release on Nov 29.
  • The household consumption indicator was buoyed by growth in retail trade of clothing and footwear, telecommunications and recreation and culture goods/services.
  • The Riksbank expects consumption to drive an economic recovery next year, with interest rates transmitting quickly through the household cash flow (i.e. mortgage) channel.
  • Services production was strong for a second month in September at 1.1% M/M (vs 2.0% prior), while industrial production was 1.2% M/M (vs 0.7% prior).
  • However, the volatile industrial orders series fell 3.6% M/M after a strong 4.3% prior). Overall, this suggests underlying manufacturing demand remains weak, likely weighing on Q3 investment spending.