Swedish household consumption rises slightly in January

Swedish household consumption rose slightly in the month of January. Consumption rose just 0.8 percent year-on-year, increasing worries that house prices trend is weighing on domestic demand. Household consumption has levelled out in recent month and is basically unchanged since October last year.

The monthly figures are jumpy, but it is worrying that the deceleration in consumption growth coincides with house prices developments, implying that consumption growth might slow further. But, consumer sentiment is healthy and house prices appear to have leveled out at the start of 2018. Therefore, consumption is unlikely to plunge.

“The Riksbank’s call for consumption growth at 2.9 percent for FY 2018 nevertheless looks too high”, noted Nordea Bank in a research report.

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