Swedish households remain pessimistic
Peter Vinthagen Simpson · 22 Dec 2008, 10:48
Published: 22 Dec 2008 10:48 GMT+01:00
- Confidence in economy hits record low (26 Nov 08)
- Swedish economy set for minor recession (29 Oct 08)
- Swedish economic growth set to contract (27 Aug 08)
NIER's barometer indicator, which measures confidence among companies and households, declined in December to 68.9 - the lowest level since records began in 1996.
Confidence among households did however climb marginally in December, with NIER's consumer confidence indicator climbing to -23.4, which indicates that households remain considerably gloomier than normal.
Lower prices for consumable items have given some seasonal cheer and explain the slight improvement. The proportion of households that consider it is currently the right time to buy durables rose from 15 percent in November to 20 percent in December.
Furthermore 40 percent of households reported that it is likely that they would renovate their homes in the next year, up from 34 percent in November.
Household 12-month inflation expectations fell to 1.4 percent in December, down from 1.8 percent in November. Perceived inflation is currently at 3 percent.
There has been little change in consumer confidence with regard to the Swedish economy. 82 percent of households stated that the situation has become worse over the past year, compared to 78 percent last month.
23 percent consider their risk of unemployment to have increased, compared to 18 percent in November. This gloomy picture is supported by a survey of business sentiment.
The business sector reported a tougher business climate in December. 34 percent of companies stated that it was more difficult than normal to finance operations. Almost half of companies cited stricter credit checks as the primary reason.
The sector forecast widespread staff cuts as the business confidence indicator declined for the third consecutive month to -26, its lowest level since 1996.