Swedish companies see no concrete signs of an economic recovery as demand declines because of a strong currency and cost-cutting in debt-stricken Europe, according to a central bank survey.
Companies will continue to cut jobs in the coming months as several manufacturing companies “believe that they will need to lower their prices in this quarter,” the Riksbank said today in a statement.
“The level of new orders for the construction and export companies remains low and several companies expect to see shrinking order books in the period ahead,” the Riksbank said. “However, there are some bright spots in the international business cycle and a majority of the companies hope that economic activity will improve towards the summer despite the weak inflow of new orders.”
Sweden’s economic expansion slowed last year as waning growth abroad hurt demand for the country’s exports and forced companies including Ericsson AB, the world’s largest maker of mobile networks, and truck maker Volvo AB, to cut jobs. About 70 percent of Swedish exports, which account for about half of the country’s output, go to Europe.
Separate surveys by Swedbank AB of purchasing managers signaled an improvement in manufacturing and services last month. A services index rose to 52.4 in January, while a manufacturing index gained to 49.2. A reading above 50 indicates an expansion.
Sweden’s central bank conducted interviews with companies in the construction, retail, manufacturing and service sectors between Jan. 7 and Jan. 18. This time 25 companies were interviewed with about 210,000 employees.
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