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Dec. 15 (Bloomberg) -- Swedish employment fell for a fourth month in November as Europe’s debt crisis saps momentum in the largest Nordic economy, giving the central bank more scope to cut interest rates next week.
Total employment fell to 4.629 million people from 4.635 million in October, Stockholm-based Statistics Sweden said today. The non-seasonally adjusted unemployment rate fell to 6.7 percent from 6.9 percent a month earlier, as more people left the labor market. The median forecast of thirteen economists surveyed by Bloomberg was for 6.8 percent unemployment.
“The deteriorating labor market is an important reason why we expect the Riksbank to cut rates below 1 percent next year,” said Torbjoern Isaksson, an analyst at Nordea Bank AB, in a note to clients.
The Riksbank has left its benchmark interest rate unchanged at 2 percent since July and in October signaled fewer increases next year as Europe’s debt crisis threatens to stall growth. Norway’s central bank yesterday unexpectedly cut its main rate by 0.5 percentage point to 1.75 percent, fueling speculation the Riksbank will also lower rates.
“Despite continued solid growth in the Swedish economy, the pressure on the Riksbank to lower its repo rate has increased,” Erica Blomgren, an analyst at SEB AB, said in a note before today’s unemployment data.
--Editors: Jonas Bergman, Tasneem Brogger.
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