Swedish production in total business sector rises below expectations in April

Swedish production in the total business sector came in below expectations in April. Figures were subdued throughout the board in sub sectors. Production in the total business sector rose 0.3 percent sequentially in the month. But, on a year-on-year basis, the figure came in below forecast at 3.3 percent as the first quarter figures were downwardly revised by a full 1 percentage point.

Production in the service sector fell sequentially, while it also dropped in manufacturing industry and the construction sector. The overall scenario is that growth is decelerating in the total business sector, consistent with indicators. Production in the construction sector has fallen for four straight months and might probably continue to fall. The services sector and manufacturing industry is performing better but growth is likely to have peaked, noted Nordea Bank in a research report. Order intake to the manufacturing industry levelled out as well.

“Production data was a decent indicator for GDP growth in Q1 but has overestimated growth in 2017. Thus, it is not a reliable indicator. As such, today’s figures suggest that GDP growth is slowing, in line with our view”, added Nordea Bank.

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