Swedish household consumption rises in January

Swedish household consumption rises in January, while the data for prior months were upwardly revised. On a sequential basis, Sweden’s household consumption rose 0.7 percent in the month, as compared with the upwardly revised -0.4 percent print recorded in the prior month.

On a year-on-year basis, the household consumption rose 1.1 percent, as compared with the upwardly revised 0.3 percent gain seen in December. The January data came in better than expected.

The positive news is that consumption has grown since last summer. However, the rise is from a low level and that consumption is still lower than in the second quarter of 2018. The set back on the housing market is the main reason for the sluggish consumption.

“The tentative signs of a pick-up in consumption is welcomed by the Riksbank, but the bank is still too optimistic on consumption. Weak domestic demand should be a source of concern for the Riksbank”, said Nordea Bank in a research report.