Swedish manufacturing confidence slumped in August amid slowing domestic orders and falling employment.
A manufacturing confidence index fell to minus 9 from a revised minus 3, the Stockholm-based National Institute of Economic Research said today. It was estimated at minus 2 in a Bloomberg survey. The consumer confidence index fell to 5.4 from 5.6 the previous month. Economists predicted confidence would rise to 5.7, according to the median of 12 forecasts.
“New orders from the domestic market fell, while new export orders and output volume remained almost unchanged,” the NIER said. “Employment fell somewhat and plans for the next few months indicate further cuts. Output volume is forecast to increase somewhat.”
The Swedish government on Aug. 24 cut its economic forecast for next year to 2.7 percent as Europe’s debt crisis erodes demand for exports. The central bank will lower its main lending rate to 1 percent this year from 1.5 percent to stimulate demand, SEB AB predicted in a report published yesterday.
Sweden, which relies on sales abroad for about half of its output, sends 70 percent of its exports to Europe where countries such as Greece, Italy and Spain are forced to rein in spending to cut public deficits.
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