SWEDEN
The flash GDP indicator once again proved an unreliable estimate of actual GDP, after Q2’s final print was -0.3% Q/Q (vs flash of -0.8% Q/Q). While today’s Economic Tendency Indicator (due 0800BST/0900CET) will provide a more forward-looking view of activity, this GDP outturn should temper expectations for a 50bp Riksbank rate cut in September, given the sentiment from Monday’s minutes.
- The actual GDP outturn remains below the Riksbank’s June MPR forecast of 0.0% Q/Q though, so should prompt some adjustments to the growth profile at the September forecast round.
- Inventories once again skewed the outturn, contributing -0.6pp to quarterly GDP growth. All components excluding inventories contributed 0.4pp to Q/Q GDP (vs -0.4pp in Q1).
- Domestic consumption remained weak in Q2, as suggested by the monthly consumption indicator outcomes. Consumption was -0.2% Q/Q (vs -0.5% in Q1), contributing -0.1pp to quarterly GDP growth.
- Meanwhile net exports were a strong contributing factor as expected, with exports rising 1.4% Q/Q and imports falling 0.6% Q/Q, contributing 0.9pp to quarterly GDP.
- However, investment was weak at -1.7% Q/Q (vs 0.2% prior), contributing -0.4pp.
- On an annual basis, GDP rose 0.5% Y/Y (vs 0.0% flash). There were small upward revisions to last quarter’s outcomes, to 0.8% Q/Q and 0.9% Y/Y.
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