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Consumer prices keep dropping in Sweden

AFP/The Local · 11 Aug 2009, 11:52

Published: 11 Aug 2009 11:52 GMT+02:00

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Swedish prices fell by 0.9 percent in July on a 12-month basis, after dropping by 0.6 percent in June.

July represents the fourth month running in which prices have fallen after falls of 0.4 percent in May and 0.1 percent in April.

Statistics Sweden said the fall in the price of petrol, lower interest rates for housing and cheaper clothes were the key drivers behind the month's deflation.

It also said that from June to July, consumer prices fell by 0.5 percent.

Sweden experienced several months of strong inflation last year before tailing off rapidly.

In September, inflation was as high as 4.4 percent on a 12-month comparison.

Sweden's central bank has set itself an inflation target of 2.0 percent year-on-year.

Story continues below…

Deflation can hamper economic growth because it reduces businesses profits and discourages investment.

It also leads consumers to put off buying goods in the hope that prices will continue to fall.

AFP/The Local (news@thelocal.se)

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Your comments about this article

20:38 August 11, 2009 by Pacey
What a piece of crap? what is the composition of the CPI I assume that is what they are referring to when they measure inflation.

Everything I buy from the big stores has increased in price from cheese,milk to vegetables etc. The swedish currency has strengthened against all the major ones so prices should have decreased for these rather they are increasing!

do you guys have a competition commission it should investigate this increase in prices at the retail stores/wholesale stores!!
21:51 August 11, 2009 by Nemesis
I also shop in the major stores.

The prices in ICA and COOP are still rising. I should know, I shop in them. I am also a bargain hunter. It is harder to get a bargain now in Sweden, than two years ago, regarding clothes, furniture, DVDs, or Blurays.

Whoever compiled that report, should have the eyesight, hearing, IQ tested and a drug screen.
05:40 August 12, 2009 by Omidn
@ Nemesis: :D LOOOOOL :D 100% agree with you, inflation coming down but prices going up!!!! it doesn't make sense does it!? :D
09:36 August 12, 2009 by RoyceD
obviously the flaw in this report is that they take a useless statistic and claim that it fairly represents the movement of the entire market for each individual person. Once again using a statistic that is pretty irrelevant.
15:51 August 12, 2009 by mkvgtired
Many times the CPI includes large ticket items like cars, and it almost always includes gas. It can include airline fares. Because oil has come down in price so dramatically since last year that has a large effect on the CPI figures. It usually includes rent or "rent equivalent" for owners, so housing prices would have a large effect. It also usually includes the heating source for the hosue. I have a feeling it is the large ticket items like cars, housing, and some heavily used items like gas that have contributed to the deflation, and not day to day expenses like haircuts or groceries.
16:04 August 12, 2009 by Holecutter > The Howl From He
A savvy investment firm looking to invest, lets say in Sweden for whatever reason. Will view stats as these as false stats, doctored stats, and will internally ask...what are they hiding in putting out stuff like this when everyone knows that across the board....everything has gone up, not down, and the only thing that has gone down is disposal incomes.

However, based on what we read, and the lack of finite details, we can only assume that another department is not paying attention....again.

08:53 August 18, 2009 by jimhenry1808
Even with Cash for Clunkers never forget to negotiate the car price.




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