Swedish wages rise slightly below expectations in June

Swedish wages rose slightly below expectations in June. The Swedish Mediation Office estimate showed that the wages in Sweden rose 2.6 percent year-on-year, as compared with expectations of 2.7 percent.

Furthermore, 2017 figures and figures for previous months for 2018 were downwardly revised a bit. The new figures indicate that wages rose 2.5 percent year-on-year in the first half of 2018, slightly higher than the 2.4 percent recorded in 2017.

The Riksbank’s forecast for FY 2018 at 2.7 percent appears too high. The new figures imply that wages might rather rise by 2.6 percent. The deviation from the central bank’s forecast is small but is still significant. The low wage inflation might increase Riksbank’s concerns for the too low core-inflation.

Centralized wage agreements are set at just above 2 percent yearly up to and including the spring of 2020, which might continue to anchor wage expectations and be a drag on wage growth in 2018 and 2019, stated Nordea Bank in a research report.