Swedish jobless data volatile, employment growth to slow eventually

The Labor Force Survey data of Sweden continues to be quite volatile. Jobless rate in the country was up again in July following an unexpected low reading recorded in June. However, the central bank’s unemployment forecast is within reach. Seasonally adjusted jobless rate rose to 7 percent in July from 6.6 percent in June. Consensus expectation was 6.7 percent.

According to Statistics Sweden, the interpretation of the labor market in summer months is usually more difficult as compared with the remainder of 2016. In July 2016, the number of employed persons aged 15-74 amounted to 5,059,000, not seasonally adjusted, corresponding to an increase of 56,000 when compared with July 2015. The jobless rate, not seasonally adjusted, came in at 6.3 percent, as compared with consensus expectation of 5.9 percent.

Seeing through the volatility, the labor market situation is rebounding. The Swedish central bank, Riksbank, projects jobless rate to come in at an average of 6.9 percent in the third quarter of 2016, which is quite within reach. As GDP growth is expected to remain modest in the future, employment growth is likely to decelerate ultimately, according to Nordea Bank.

Meanwhile, the country also released its producer prices data that indicated a total fall of 0.3 percent in sequential terms in July. Producer prices had grown 1.5 percent in June. On a year-on-year basis, producer prices dropped 1.1 percent in the month. Prices in the import and export markets fell 0.6 percent and 0.3 percent respectively.