SWEDEN: Goods Trade Balance Narrows In July, But Positive Signals For Q2 GDP

The Swedish July goods trade balance was SEK6.5bln (vs SEK8.1bln in June). The “trend” series, which smooths out the monthly volatility, was SEK7.7bln (vs SEK7.5bln prior). 

• The monthly trade data is recorded in nominal terms, and thus closely tracks the development of import/export prices, which have largely moved in tandem since mid-2022.
• As such, the widening of the trade balance in 2022 reflects a relatively resilient development of exports.
• Quarterly trade data, also released today, indicated that the volume of exports rose by 2% in Q2, while import volumes fell 2%. This suggests a positive contribution of net exports to tomorrow’s Q2 GDP figure, and also a further widening of Sweden’s current account surplus (which is largely goods-driven).
• Net trade of goods with EU member states recorded a deficit in July (of SEK16.2bln), but this was more than offset by a surplus of net trade to non-EU states (SEK22.7bln).
• The press release notes that across January to June 2024, exports to Germany fell by 8% (unsurprisingly given Germany’s well-documented economic weakness this year). Imports from Germany fell 5% across the same period.