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ECONOMY

Sweden facing ‘the highest inflation in 30 years’

Sweden last month saw the highest levels of inflation in more than 30 years, according to the latest figures from Statistics Sweden.

Sweden facing 'the highest inflation in 30 years'
Meat and vegetables led price rises in April. Photo: Anders Wiklund/TT

Consumer prices rose 6.4 percent in April, the agency reported in its latest monthly figures, well ahead of the 6.1 percent rise predicted by analysts and up from 6.1 percent in March. 

“This shows high inflationary pressure. It’s in line with consensus, but it’s 0.2 percentage points higher than what the Riksbank has been predicting,” said Olle Holmgren, an economist with SEB. 

Rising prices of meat, vegetables and other groceries were the main reasons for the rise, with the prices of electricity and fuel falling month-on-month. If energy prices are excluded, inflation was 4.5 percent in April, up from 4.1 percent in March. 

“Restaurant prices are rise quite a bit for the second month in a row. That can be linked to grocery prices,” Holmgren said. “Then there are higher prices generally, but grocery prices are increasing rapidly.”

Holmgren predicted that the inflation rate could continue to rise in the coming months, increasing the risk that Sweden’s public bank, the Riksbank, will hike interest by 0.5 percentage points — two slots — in September. 

Fuel prices fell in April compared to March, although diesel remains 56.7 percent higher than a year ago and petrol 36 percent higher. 

The price coffee is higher now than at any time since it joined the consumer price index in 1983, after rising 29 percent so far this year. 

Other groceries which have risen significantly in price this year are cabbage and tomatoes, which rose in price by 43 percent ad 33 percent respectively. 

The price of avocado has fallen by 14 percent this year, while pickled herring has fallen in price by 16 percent. 

Member comments

  1. Why am I not surprised and when Putin cuts off Finland’s Gas supplies today as he said he would , he will make Sweden beg for mercy when he turns to them , and this Inflation problem will not be the only problem the we know it all Swedes have on their hands . The Neutrality was a Sweden’s most powerful weapon , recognised and respected all over the world , so throwing it away because of Ukraine deserves no sympathy . I invested millions in Sweden , came with my own money and have left with my money to a safer place to live where people actually understand Geopolitics .

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ECONOMY

Swedish parliament approves government’s budget

The government's budget and controversial pensions agreement has been passed by parliament after an independent MP, who held the deciding vote, chose to support it at the last minute.

Swedish parliament approves government's budget

The budget passed by 174 to 173 votes.

As a result, guaranteed pensions for pensioners on low or no incomes will increase by up to 800 kronor a month after tax from August.

Formally, a majority of MP’s voted no to the right-wing opposition’s budget, proposed by the Moderates, the Christian Democrats, the Liberals and the Sweden Democrats, meaning that the budget proposed by the government with the support of the Green Party, the Left Party and the Centre Party was approved.

If the vote had been even on both sides, it could have been decided by drawing lots, giving each budget a 50 percent chance of being passed.

Finance Minister Mikael Damberg thanked the parties supporting the government’s budget in a press conference following the vote.

“I want to thank the parties who contributed to this: the Centre Party, the Left Party and the Green Party,” he said. “In total, a million pensioners will be affected by this proposal as soon as this autumn.”

“It’s a necessary reform which is about equality. After a life spent working in Sweden, everyone has the right to economic security in their old age.”

In an interview with public service broadcaster SVT Nyheter after the vote, leader of the conservative Moderate party, Ulf Kristersson criticised the new budget, stating that pensioners would have been better off under the opposition’s proposal.

“It harms confidence in Swedish economic policy and it’s bad for the pensioners who would have had a better pension under our proposal,” he told SVT.

“It shouldn’t ever go to drawing lots,” he told SVT, “this has been a rather telling end to a term of office which has been completely unsustainable.”

“We need governments who can govern, with a governing foundation and well-thought-out economic policy.”

On the other side of the political divide, Left Party leader Nooshi Dadgostar was happy to see the government’s budget passed, despite the fact that the so-called Nooshi-supplement to pensions which she had lobbied for was not included in the final pension proposal.

“It’s a long time since I was this happy,” she told SVT. “We wanted a raise in the guarantee pension from the beginning – we haven’t raised the guarantee pension by this much in over 25 years.”

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